Nearly a third of Americans have made one of the worst retirement savings mistakes, and nearly half who have regretted doing so.
Nearly a third of Americans have made one of the worst retirement savings mistakes, and nearly half who have regretted doing so, according to a new survey.
TIAA-CREF recently found that 29% of Americans who participate in a retirement plan have taken out a loan from the savings in the plan. Of those who have borrowed 44% said they regret the decision, but another 43% have taken out 2 or 3 loans.
"Too many people have struggled since the 2008 financial crisis and have looked at loans from their retirement plans as a way to ease financial stress," Teresa Hassara, executive vice president of TIAA-CREF's Institutional Business, said in a statement. “However, individuals should weigh all of their options carefully before borrowing from their plan savings or reducing their contributions. Loans can undermine retirement savings and cause investors to miss out on earnings from rising markets. It's important to evaluate the benefits of taking a loan now against the need for those earnings to build long-term retirement security."
The top reason for taking out a loan from a retirement plan was to pay off debt (46%), and women were more likely than men (52% to 41%) to borrow money for this reason. Men were more likely (40% to 29%) to borrow money to pay for an emergency expenditure.