More Americans are cracking open their retirement piggy banks before retirement, and the trend is accelerating. Vanguard’s “How America Saves 2026” report, which analyzes 2025 data from its administered plans, found that 6% of 401(k) participants made hardship withdrawals last year, up from a range of 4.8% to 5% in 2024.
Before the pandemic, hardship withdrawals sat at roughly 2% of participants. The current figure is nearly triple that baseline, and it marks the sixth consecutive annual increase.
The numbers behind the squeeze
The median hardship withdrawal was $1,900. Housing costs rank among the top reasons participants cited for tapping their retirement funds. Specifically, covering mortgage or rent payments to stave off eviction or foreclosure drove many of these withdrawals.
Average 401(k) balances simultaneously hit a record high of approximately $168,000, climbing 13% year-over-year.
