As hard as it can be to look this far down the road, doing so is paramount. Too much focus on the short-term might help you for two or three months, but it could also cripple you for two or three decades. Practice discipline and play the long game*, regardless of what everyone else is doing.
*I'm eighty now; for me, the long game is 2021
Larry Alton "Financially, things are tough right now. These aren’t words you thought you’d be reading eight or nine weeks ago, but it’s true. And before you go tapping into your 401(k) plan, it’s helpful to understand what’s at stake.
"What the New Coronavirus Stimulus Package Means for 401(k)s
"The recently enacted Coronavirus Aid, Relief, and Economic Security (CARES) Act is unprecedented in size, support, and reach. And while most people are talking about how the $2 trillion bill provides stimulus checks for millions of working Americans and forgivable loans for small businesses, there’s another element that has some buzzing.
"Under the CARES Act, people no longer have to wait until they reach a certain age (59½) to start pulling our retirement funds without penalty. For a limited time, you’re actually able to withdraw as much as $100,000 in retirement assets as qualified distributions if the withdrawal is linked to COVID-19 (such as a layoff or diagnosis). Investors are also able to take up to $100,000 as a loan against their 401(k), which is an increase from the previous maximum of $50,000.
"Under normal circumstances, savers face a 10 percent penalty when assets are prematurely withdrawn from a retirement plan (meaning prior to the age of 59½). This is no longer the case. This is one of those rare moments where investors can tap in and avoid getting hit with a massive fee. And though savers will still be required to pay taxes on the money they withdraw, the tax burden can be spread out over a period of three years.
"Timely Tips, Strategies, and Suggestions:" . . .
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