You may have considered tapping your retirement savings if you got caught without enough cash to cover an unexpected expense.

While the IRS doesn't make it convenient or cheap to use a retirement account like a piggy bank,

they have made small changes that will help if you're in a pinch.

This podcast will review retirement account withdrawal rules and a recent change that makes tapping your retirement savings for emergencies less costly.

And I'll discuss whether taking advantage of the new rule is a good idea.

Welcome back. I appreciate you joining me for Money Girl episode 887.

I'm Laura Adams, an award-winning author, finance spokesperson, money speaker, founder of the

Money Stack, which is my substack newsletter, and host of this podcast with over 43 million downloads.

If you're getting value from the free content we love creating here, subscribe and consider

submitting a five-star rating or review on your podcast app. And if you have a question about money

for the show, you can leave it on our voicemail at 302-364-0308. Or you can shoot me an email and sign it for

the free MoneyStack newsletter when you visit laura d adams.com. So before we talk about the new

emergency withdrawal rule that started in 2024, let's review the general rules for

tapping a workplace retirement account. When you have funds in a tax-advantaged, employer-sponsored

retirement plan, like a 401k, 403B, or 457, you must follow strict IRS regulations. The rules were designed to prevent you from

taking money out of a retirement account, so it stays there. It stays invested and it grows,

giving you as much future financial security as possible. In addition, your employer customizes

specific retirement plan options, like who qualifies to participate

and whether they're going to allow loans and hardship withdrawals with the plan.

Therefore, if your retirement plan at work allows it, you can take hardship withdrawals.

However, you must pay income tax on amounts not previously taxed,

like those deductible contributions and the growth in a traditional 401k. Plus, if you take a

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