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Should I Drain My 401k with Disabled Spouse? – Selena

I have a disabled spouse, who is still waiting for his rating from the US NAVY for his disability.

He has Multiple Sclerosis and has ZERO income, I was the bread winner in the family, until out of the blue, my employer closed our facility on Dec. 30th, 2011.

After 18 years at my company, I am now without a job for the first time in my life. I have applied for un-employment, but nothing has come thru yet, and it will be less than a third of my previous pay.

I want to take out my 401K, so we can survive. Is this considered a hardship and I can get around being penalized so much? I’m 47. Help? What should I do?


Dear Selena,

Your 401(k) plan may allow for a hardship withdrawal that you can apply for. You will have to contact the 401(k) plan administrator to inquire.

While this might be a short term solution, it is not a long term one. If you drain the 401(k) without dealing with the underlying financial situation you will still be in trouble and then broke.

What kind of debt payments are you making right now? Maybe we can deal with that and reduce your monthly expenses to minimize the drain on your savings.

Please post your responses and follow-up messages to me on this in the comments section below.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

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Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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