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    tomo's Avatar
    tomo Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Oct 16, 2006, 10:56 AM
    401k
    I was let go by a company 3years ago I have a 401k plan there. I am wondering if I can withdraw these funds at this time.
    RichardBondMan's Avatar
    RichardBondMan Posts: 832, Reputation: 66
    Senior Member
    		  
    #2

    Oct 30, 2006, 10:08 PM
    Quote Originally Posted by tomo
    i was let go by a company 3years ago i have a 401k plan there. I am wondering if i can withdraw these funds at this time.
    Yes, but ask them to make sure, you will have to pay taxes on the entire distribution since you were granted a deduction for the contributions, if tax deferred in then it will be taxed coming out, unless you are at least 59 1/2 yrs old. Check into taking out a loan, no taxes then, just interest on what you borrow. Plan must permit loans, some do not.
    rkim291968's Avatar
    rkim291968 Posts: 261, Reputation: 34
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    #3

    Oct 31, 2006, 12:29 AM
    You can always withdraw but there is a penalty on top of tax you pay if you are under certain age (59 1/2?). So, taking out a loan against your 401k may be better. The interest you pay goes into your 401k account so it is like an interest free loan.
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
    Computer Expert and Renaissance Man
    		  
    #4

    Oct 31, 2006, 07:15 AM
    Since you are no longer working there a loan is generally not a possibil;ity since the loan payments usually have to be from payroll deductions.

    As noted, you can withdraw the money, but if you aren't of retirement age, you will pay a penalty. In addition the withdrawal is taxed as regular income.
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