Why cashing out your 401k will devastate your retirement income

Besides paying taxes and penalties, the worst part of doing this is sacrificing the miracle of compound interest. The money you cash out will never get a chance to grow. 35% of workers who left their previous employer did this last year. In a study completed by Fidelity Investments this could lead to sacrificing $470 a month in retirement income. Anyone could have a financial emergency but your 401k should be your last choice if you need money.