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View Full Version : Do I have to wait any period to take my 401k if I'm over 591/2


Carolynnnn
Aug 8, 2011, 09:25 AM
If I'm opening up a 401k for first time at 68 years old, is there any special waiting period seeing I'm over the 591/2 starting age to take it

ebaines
Aug 8, 2011, 09:33 AM
Depends on your employment status and the rules of your specific plan. The IRS requires that you must start taking withdrawals by April 1 of the first year after either (a) you turn 70-1/2 or (b) you quit working, whichever comes later. However, the rules of your specific plan may actually require that you start distributions by April 1 of the year after you turn 70-1/2, even if you are still working. There may also be special vesting rules in your plan. So check with your plan administrator to see what the rules are.

Carolynnnn
Aug 8, 2011, 10:21 AM
Because I am 68 and setting up for the first time a 401k at my work, my question is, do I fall into the same rules as if I had this 401 k for a long time. If I quit a year from now can I still wait until I'm 70-1/2 to start taking contributions. My work contributes so even if I had this for a year its like free money from them.

Thank you

ebaines
Aug 8, 2011, 11:35 AM
As I said before - check with your plan administrator for the specific rules of your plan. But in general if you quit a year from now (at age 69) you can wait to 70-1/2 before taking distributions UNLESS your company has some other rules in place. For example - many plans have a rule that if you leave and have a balance less than $5K they will automatically distribute the money (this is so they don't have to keep open a lot of small accounts for ex-employeess). It's good that your employer makes contributions for you but of course that would stop as soon as you are no longer an employee.