Ted Cruz warns all Americans with a 401(k) after ‘bloodbath’ midterm: Hardship at 3X normal because Trump won’t listen. Protect your nest egg now

“Food is too high, gas is too high, diesel is too high, insurance is too high, life is too high,” he said.

Then he took aim at one of President Donald Trump’s signature policies.

“Tariffs have made everything too expensive, and the Iran war has dragged on too long.”

To show how far some Americans were being pushed, Cruz pointed to a growing share of workers forced to crack open their retirement savings.

“In 2025, 6% of 401(k) holders took hardship withdrawals, paying penalties. That is a record, and triple the norm,” he said.

Cruz didn’t name his source, but the figure matches Vanguard’s How America Saves 2026 report. Vanguard found that 6% of eligible participants in the plans it administers took at least one hardship withdrawal in 2025. That’s up from 4.8% a year earlier and roughly triple the pre-pandemic average of about 2%.

Money you take out through a hardship withdrawal is money that can no longer grow in your retirement account. And there can be a cost up front, too.

A hardship withdrawal from a traditional 401(k) generally counts as taxable income. If you’re under 59½, you may also owe an additional 10% tax unless you qualify for an exception. And unlike a 401(k) loan, a hardship withdrawal can’t be paid back into the plan.

The strain Cruz described is showing up at the grocery checkout, too. In a LendingTree survey, 29% of buy now, pay later users said they had used the loans to buy groceries, more than double the 14% who said so two years earlier. Other than groceries, BNPL users have used these loans to pay for medical and dental care, and utility bills.

Inflation has many causes, but Cruz had a point about how Trump’s policies have added to the cost of living.

Researchers at the New York Fed estimated that U.S. businesses and consumers together bore nearly 90% of the economic burden of the 2025 tariffs.

The Iran war added a different kind of pressure. AAA puts the U.S. national average for regular gas at about $4.07 a gallon at the time of writing, up nearly 32% from a year ago. Diesel is up a whopping 68% over the same period. Brown University’s Iran War Energy Cost Tracker estimates that Americans have spent over $153 billion more on gas and diesel than they would have without the war.

While Cruz called out Trump’s policies for making everything “too expensive,” inflation itself is nothing new — it has been eroding the purchasing power of Americans for decades.

According to the Federal Reserve Bank of Minneapolis, $100 in 2026 has the same purchasing power as just $11.65 did in 1970.

That’s right. $100 became less than $12.

The good news? Throughout history, savvy investors have found ways to shield their wealth from inflation’s bite — no matter who sits in the White House.

Own something the government can’t print

When it comes to preserving wealth and fighting inflation, few assets have stood the test of time like gold.

Its appeal is simple: Unlike fiat currencies, the yellow metal can’t be printed at will by central banks. This inherently limited supply can help it store value.

Gold is also considered the ultimate safe haven. It’s not tied to any one country, currency or economy, and in times of economic turmoil or geopolitical uncertainty, investors often flock to it — driving prices higher.

Ray Dalio, founder of the world’s largest hedge fund, Bridgewater Associates, has repeatedly highlighted gold’s role in a resilient portfolio.

“People don’t have, typically, an adequate amount of gold in their portfolio,” Dalio told CNBC last year. “When bad times come, gold is a very effective diversifier.”

Over the past five years, as inflation continued to chip away at the purchasing power of the dollar, gold has climbed about 121%.

Other prominent voices see further potential. JPMorgan CEO Jamie Dimon has said that in this environment, gold can “easily” rise to $10,000 an ounce.

One way to invest in gold that also provides significant tax advantages is to open a gold IRA with the help of American Hartford Gold.

Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account — combining the tax advantages of an IRA with the protective benefits of investing in gold, making it an option for those looking to potentially hedge their retirement funds against economic uncertainties.

Even better, you can often roll over existing 401(k) or IRA accounts into a gold IRA without tax-related penalties. American Hartford Gold also helps keep startup costs down with free account setup, free insured shipping and up to five years of free storage. To learn more, get your free information guide on investing in precious metals.

If you change your mind, you can cancel within seven days for a full refund on eligible assets. With their price protection guarantee, if prices drop within seven days of your purchase, your order is repriced to reflect the lower price.

Qualifying purchases can also receive up to $25,000 in free silver. Just remember — gold is often best used as one part of an otherwise well-diversified portfolio.

Build income outside your 401(k)

Gold isn’t the only asset investors turn to during inflationary times. Real estate has also proven to be a powerful hedge.

That’s because when inflation rises, property values often increase as well, reflecting the higher costs of materials, labor and land. At the same time, rental income tends to go up, providing landlords with a revenue stream that adjusts for inflation.

For households feeling the squeeze Cruz described, that rental income can help cover rising expenses without dipping into retirement savings.

Over the past 10 years, the S&P Cotality Case-Shiller U.S. National Home Price NSA Index has jumped by 84%, reflecting strong demand and limited housing supply.

Of course, high home prices can make buying a home more challenging, especially with mortgage rates still elevated. And being a landlord isn’t exactly hands-off work — managing tenants, maintenance and repairs can quickly eat into your time (and returns).

The good news? You don’t need to buy a property outright — or deal with leaky faucets — to invest in real estate today. Platforms like mogul provide an easier way to get exposure to this income-generating asset class.