Author:
roberta palmer (frustrated)
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Date Posted: 15:39:15 05/10/07 Thu
In reply to:
401K Expert
's message, "401K Early Withdrawal" on 05:38:07 07/05/05 Tue
>You can make an early withdrawal from your 401k
>account, but you will definitely lose some money in
>the process.
>
>The money that you contribute to your 401k is yours,
>and you can make a full or partial withdrawal of your
>vested funds at anytime that your plan allows.
>However, no matter what your age, any funds taken out
>will be subject to income tax and you will be
>ultimately taxed according to your income bracket and
>current tax rates. Remember that large withdrawals may
>put you into a more expensive tax bracket, and that a
>mandatory 20% tax withholding is taken out up-front so
>the cash you wind-up with will be less than the
>original withdrawal amount.
>
>On top of the taxes, you may also face an early
>withdrawal penalty if younger than the retirement age
>(59.5). Currently running at 10%, the penalty can only
>be avoided in certain hardship cases as provided by
>law. These include heavy medical expense burden,
>disability, certain cases involving higher-education
>expenses, buying or building a first home and some
>other cases.
>
>As an alternative to 401k early withdrawals, consider
>401k rollovers or 401k loans, which allow you to
>borrow from yourself with all the interest being payed
>to you into your 401k account.
How do I find out what I have in there?
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