We study how early withdrawal policies in retirement savings balance consumption smoothing and commitment. Using Danish administrative data, we document that early withdrawals increase sharply after life events entailing financial hardship. However, using a natural experiment, we also show that individuals respond strongly to an exogenous reduction in early withdrawal penalties, unrelated to periods of financial hardship. We use these empirical patterns to discipline a quantitative life-cycle model featuring a liquid savings account and a pension account subject to early withdrawal penalties, addressing both liquidity and commitment needs. We show that policies combining penalty-free access in adverse states with positive penalties otherwise dominate uniform schemes, improving both consumption smoothing and retirement saving outcomes.