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Anyone know about cashing out 401K?

Anonymous
Posted by Anonymous
  • 32 Replies
Dh isn't happy at all at his job. It's only getting worse. I hate to see him quit but it has him so stressed out. He's been with the company 7yrs, making over 100k with a very secure company. He has right at 150k in stocks for retirement. He's 30 idk if that matters.


Anyone know how the penalties work? I really hope he doesn't quit anytime soon. I believe there is a light at the end of the tunnel (1st of the year) but idk if he can make it until then :-/
Posted by Anonymous on Oct. 9, 2013 at 1:03 PM
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Replies (1-10):
Anonymous
by Anonymous 1 - Original Poster on Oct. 9, 2013 at 1:03 PM
Bump
Anonymous
by Anonymous 1 - Original Poster on Oct. 9, 2013 at 1:03 PM
Bump!
Anonymous
by Anonymous 1 - Original Poster on Oct. 9, 2013 at 1:05 PM
Bump
awesomemommy2
by on Oct. 9, 2013 at 1:07 PM

Is he 100% vested?  

Anonymous
by Anonymous 1 - Original Poster on Oct. 9, 2013 at 1:08 PM
Yes

Quoting awesomemommy2:

Is he 100% vested?  

leksismommy
by Platinum Member on Oct. 9, 2013 at 1:08 PM

Call and ask, when Dh lost his job, we cashed out his 401K and there was a penalty of like 40% or something like that

Anonymous
by Anonymous 2 on Oct. 9, 2013 at 1:09 PM
They make take some sort of penalty out and they will hold 20ish% for taxes and the penalties the IRS incurs for early withdrawal. (Before 55 1/2)
steveshouse
by Bronze Member on Oct. 9, 2013 at 1:10 PM

He will not be able to pull from his 401K without a severe penalty, especially at age 30; I helped my mother convert her 401K to an IRA that she will be able to withdraw money monthly; However she still pays about $100 in taxes every month for a $600 a month deposit and she's 61; any earlier than 60 and its a big penalty especially if he tries to cash it out; He'll end up getting less than half of the amount he has if he goes that route.

awesomemommy2
by on Oct. 9, 2013 at 1:10 PM

Then I would roll it into another account to avoid the penalties.   Right off the top you pay early withdrawal and then there are the tax implications.   


Quoting Anonymous:

Yes

Quoting awesomemommy2:

Is he 100% vested?  



Anonymous
by Anonymous 3 on Oct. 9, 2013 at 1:11 PM

He doesn't have to do anything with it yet.

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