My husband has almost 14,000 in a 401K that is currently just sitting. He isn't retirement age (and nowhere near it). We are in the process of building a home (the builder is going to purchase our current home if it doesn't sale at the end of the transaction) and we would like to use the money as down payment/start up money. We have another account with Edward Jones. I also have a 403B (I'm a teacher) and a small CD so we will still have money growing for retirement. Can we cash it out for the home without the penalties/taxes being as harsh? Should we roll it over first then use the money? We need the money but want to get it with the least amount of money lost. Thanks in advance for your help.

You can "cash it in" if the company he works for will allow it, most will not if you are still working there. He could take a loan out against it.

If he does get to ca in, you will pay the standard tax on it, 20 to 30 percent and a 10 percent penalty.