The vast majority of retirement plan savers opted not to take advantage of the coronavirus-related distributions available under the CARES Act, according to recent research from Vanguard.
Less than 6% of participants withdrew assets with the typical participant accessing about $13,300, Vanguard found.
Of the 5.7% who accessed their retirement savings, 69% took one distribution, while 31% initiated multiple distributions over the nine-month period that such distributions were allowed. Sixty percent of all withdrawals were for less than $20,000 with nearly 25% being for less than $5,000. Only 4% of participants withdrew the maximum amount of $100,000.
The take-up on the withdrawals varied by demographics. The participants most likely to take distributions were 35 to 54 years old and had $30,000 to $75,000 in income. Those with account balances from $10,000 to $50,000 were also more likely to request a distribution when compared with participants with larger account balances, according to Vanguard's findings.