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Not working for company anymore can i cash out?

Apr 01, 2014 by marisol from Fort Myers, FL in  |  Flag
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Simple answer is Yes.

Depending on your age, you may experience a penalty for early withdrawal of retirement funds, plus if it isn't in a ROTH option you'll have taxes on the withdrawal as well. You may decide to just move the assets to an IRA which would not create a penalty situation (again, if you are under age 59 1/2). Then you can feel free to withdrawal only the portion of your IRA that you need.

If you're working for another company and they also have a retirement plan then you can just move the assets over to your new 401(k). There won't be any new employer contributions on that rollover, but it will be 100% vested from the start.

Go seek an advisor (one most likely is accessible from your benefits team at the previous employer) and they can walk you through the options you have.

Comment   |  Flag   |  Apr 01, 2014 from Indianapolis, IN

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Once you sever employment you can cash out your retirement plans, however depending upon your age, type of plan and length of employment you have several items to consider. If the employer matched any of your contributions there may be a vesting period for those contributions, if you are under 59.5 years old there could be an extra 10% penalty on the withdrawals, any distribution will be taxable at your ordinary income tax rate. Cashing out retirement accounts is a very specialized process and should be done by professionals.

Comment   |  Flag   |  Apr 06, 2014 from Medina, OH

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Yes ... but it's probably not a smart thing to do. When I hear someone mention "cashing out" of a 401k what I hear them say is: "I'm taking the money and plan to spend it." A 401k is designed to allow you to save money for your retirement tax deferred. The wise thing to do is to roll the money from the 401k into an IRA. This avoids the taxes and penalties and lets the money grow until you need it when you're retired. Get help from a RIA (registered investment advisor).

Comment   |  Flag   |  Jun 18, 2014 from Suffolk, VA

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Tetyana Luczaj Level 1

Absolutely you can do that, depends on your company vesting schedrule though hovever you will have to pay taxes and penalties. So you might want to hold on to it and think of posible rollover to an IRA account.

Comment   |  Flag   |  Jun 21, 2014 from HUNTINGDON VALLEY, PA

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