Why your 401(k) can be a cash drain

By Adam Shell
Everyone’s heard of stretching to buy a McMansion and becoming “house poor.” But what about saving too much for retirement and ending up  “401(k) rich and cash poor”?
Don’t snicker.
It can and does happen — often to investors with both good savings habits and good intentions for their financial future. These model savers later run into a cash crunch because of unexpected expenses, ballooning lifestyle costs or miscalculations.
Most personal finance pros advise U.S. workers to save as much as they can by stashing money in 401(k) retirement accounts, which lower taxable income and shelter investment earnings from the IRS. But there’s a downside to tying up too much cash in these accounts: it could leave you without enough money for unexpected bills.
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