Did you take money from your retirement savings account during the pandemic? Get back on track!

During the early months of the COVID-19 global pandemic, many Americans withdrew money from a retirement savings account.

And a recent study has shown that many – about half who took a loan or withdrawal from their retirement savings account – took more than they needed.

That said, many of those who took more say they are in a better place financially than they were because of that loan, so it isn’t all gloom and doom.

No one really knows how to navigate a global pandemic, and it has certainly been a time of financial stress and uncertainty for many families. And under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, people who needed financial help could take these funds from their retirement savings account.

Still, removing funds from a retirement savings account before you retire is almost never without repercussions. Generally, it will set you back on your retirement savings journey. Also, most people who took the money in 2020 likely didn’t consult with a financial planner and now have to figure out ways to get back on track.

So, what can be done to get back to saving? There are a few things. Cut expenses and take a hard look at your monthly budget. It’s also a good idea to think about building a bigger emergency fund, so when the unexpected strikes (and it always does) you’ll have a place to pull funds from instead of a retirement account.

The fact is, financial issues will crop up from time to time and while they may not be as serious or far-reaching as a global pandemic, it’s always a good idea to have a safety net in the form of liquid assets to use.

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