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won’t be growing that money tax-free anymore”—
and that can put a big dent in how much you’re ulti-
mately able to accumulate for retirement. That’s why
it’s better find another way to help pay your living
expenses now, if at all possible.Line Up Health Insurance
nearly half of americans get health
insurance through their employer and, of course, this
is a particularly worrisome time to be kicked off your
plan. “You never want to have a gap in health cover-
age,” says Denver financial planner Andrea Blackweld-
er, “but that’s especially true during this pandemic.”
Your best bet if you’re married and your spouse
still gets health insurance through work is to goonly as a last resort, the stimulus bill also makes
it easier to use 401(k)s and IRAs to help tide you
over until you’re back at work. Under the new rules,
you’ll be able to make a “hardship” withdrawal of
up to $100,000 from these accounts without the
standard 10 percent penalty for taking out mon-
ey before age 59¹⁄₂ (age 55, if you’ve been laid off ).
You’ll still owe taxes on the withdrawal but can pay
it back over a three-year period or avoid the tax
entirely if you put the money back into your plan
during that time. The bill also doubles the amount
people can borrow against their 401(k) and delays
any repayment due in 2020 for a year, on both new
and existing loans.
“The drawback,” as Cheng points out, “is that you
Clockwise from below:
It’s no longer business
as usual at this Disney
Store in San Francisco—or
anywhere else in the U.S.;
new federal rules will help
struggling homeowners
pay their mortgages,
hoping to avoid the wave of
foreclosures that occurred
after the ɿnancial crisis.