NEVER Borrow from Your Retirement

Tapping into your retirement savings might seem like a quick solution to a financial hurdle. But resist the urge! Here’s why borrowing from your retirement account can be a costly decision:

Missing Out on Growth: Your retirement savings are designed to grow over time through compound interest. Taking a loan removes money from this crucial growth cycle, likely leaving you with a smaller nest egg in retirement.

Double the Hit: You’ll repay the loan with interest, essentially paying yourself back with after-tax dollars. When coupled with the missed growth opportunity, this double whammy makes saving for retirement more difficult.

Limited Access: Some plans restrict your contributions while you have an outstanding loan from the plan. This can hinder your ability to catch up on missed savings or take advantage of employer matching contributions.

Future Uncertainty: Life throws curveballs. Unexpected financial emergencies might arise even after you take a loan. Having a depleted retirement account can leave you less equipped to handle future challenges.

Alternatives to Consider:

• Explore creating a budget and emergency fund to weather temporary financial strains.
  
• Talk to a financial advisor about exploring other options with potentially fewer long-term effects.
  
• Negotiate payment plans with creditors to ease immediate financial pressure.
  

Retirement savings are crucial for your financial security later in life. Think twice before tapping into this valuable resource. By planning effectively and seeking alternatives, you can navigate financial challenges without jeopardizing your future.

Hendricks Wealth & Estate Management will be speaking further on this topic during a FREE “Don’t Do Dumb” event at DC Cobb’s in East Dundee, IL on April 24, 2024 at 5:30 p.m. CST. Someone in attendance will win 2 tickets to a Cubs game at Wrigley Field.

To reserve your spot or learn about future “Don’t Do Dumb” financial sessions, visit www.jghfs.com/events. Questions? Call us at 847-428-3997.

Hendricks Wealth & Estate Management

650 Spring Hill Ring Rd., Ste. 2000

West Dundee, IL 60118

(847) 428-3997

www.jghfs.com