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Study Finds Middle-class Raiding Savings to Make Ends Meet
A recent study released by the Center for American Progress found that in 2004 middle-income families had $31 billion in outstanding loans to their 401(k) retirement plans. These loans cut into the benefits of compound interest and can have a lasting impact on a person’s retirement. The loans were primarily used to get by during temporary financial crisis, such as a medical emergency or unexpected unemployment.