The Social Security office clerk regards the 401 K as a "readily" available cash, as if it is in a bank account ready to spend, which is ridiculous. With 401 K, there are penalty for early withdrawals, before 59 1/2, which is what I prefer not to do. How can you explain this when they (Soc Sec) do not care?

First its not a good idea to piggyback your question on someone else's. This can lead to confusion. You should start a new thread. So I've moved your question to its own thread.

Can you please explain your question, it is not very clear at all. What does your having a 401(k) have to do with your Social Security?

Are you wanting to take money out of S.S. or your 401(k)?

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Originally Posted by ScottGem

First its not a good idea to piggyback your question on someone elses. This can lead to confusion. You should start a new thread. So I've moved your question to its own thread.

Can you please explain your question, it is not very clear at all. What does your having a 401(k) have to do with your Social Security?

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Hi,
I am applying for SSI but was denied because of my 401 K. I have cancer, which is consider disability. Social Sec. say I have to use/exhaust my 401 K to less than 2000 before I can qualify for SSI.

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Originally Posted by Wondergirl

Are you wanting to take money out of S.S. or your 401(k)?

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Hi,
I am applying for SSI but was denied because of my 401 K. I have cancer, which is consider disability. Social Sec. say I have to use/exhaust my 401 K to less than 2000 before I can qualify for SSI.

SSA has its rules. See here: Understanding Supplemental Security Income (SSI)-- SSI Eligibility

On the other hand, ERISA rules waive the 10% penalty is judged disabled:

401khelpcenter.com - When is a 401k Distribution Not Subject to the 10% Penalty?

SG is correct - if you are disabled you do have acces to your 401(k) assets without penalty. You will have to pay taxes on any withdrawals at ordicnarty income rates.