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What is a Hardship Withdrawal?

Investing in the future is always a great idea, and this is why we bother with things like pensions. If we have spare cash today then the wisest thing to do is put this by for later. When we get older we will likely have far less potential for making money so we have to make provisions for this now. This is why most of us will regularly put money into our pension funds. But what happens if we hit a bad patch now? Will we be able to get this money back that we have put aside for our retirement? Well this is where the hardship withdrawal comes into play. It is an option with some 401K plans and it is a way to get to our money early if life gets too rough financially. The companies that manage these plans add the hardship withdrawal element as a way to encourage people to choose them. This is because we are more likely to put money aside for our future if we know that we can get to it in an emergency.

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