Hubby has been laid off since August. Severance pay is gone and unemployment doesn't cover the bills. He is thinking of cashing out his 401K, but I know that it comes with major taxes, and then we are left with nothing. He can't borrow from it, and I had to cash mine out when we had the baby 2 years ago, and I havn't worked besides babysitting since, so this is the only retirement we have. I am 27 and he is 30, so it's a little late in the game to start from scratch. I know that tons of other families across the nation are in the same boat. Any advice?
Hi Bethany, I dont have any great advice for you but wanted to just offer a little support. I have been though the same thing and had a very hard time dipping into the 401k but we ended up having to. It was extra hard for me as I am in finance. i am a mortgage loan officer so I can also tell you that it doesnt sound like any type of mortgage help is a solution here since he would need income in order to qualify most likly the 401k is the best choice. I will tell you the only thing I have learned is not to completely panic. Some of the biggest mistakes we made where in a panic such as selling our house when in reality my low house payment wasnt the problem. We have learned to more than cut back on food and other expense but mailnly we learned that we couldnt completly overcome an income problem soley by lowering outgoing at some point you will lower the outgo as much as possible and most likley still have an income problem. Trust in God and pray for his guideance through a hard time and some how we come out on the other side with more than we had before. I have had to learn to let go and realize now that most of our parents somehow raised us on a lot less and it is in no way what I remember about my childhood the most. I remember most the loving time my parents spent with me inspite of the financial hardships they had. I appreciate that more and more every day now. I resent the least about my child hood the material things I had to do without and resent the most the times when my parents didnt show me peace, stability, love, and grace. Keep up the good work with your kids and you will get it all worked out soon I know.
Good luck and God bless!
You might want to double check the state rules, but in some states, taking the 401k bars you from recovering unemployment. It is a personal option, but I would say do what you can to keep the unemployment while you can. I know it's hard because he can't really work to supplement the income and claim unemployment. Don't be afraid to take advantage of other programs (food banks, TANF, etc) if you haven't already. Even if you don't think you qualify, just try :-). My prayers are with you and your family.