Home  >  Financial Articles and Q&A  >  How can I withdraw from my 401k plan?

How can I withdraw from my 401k plan?

I work for Highland baking Co.

Mar 15, 2015 by vicente in  |  Flag
2 Answers  |  2 Followers
Follow Question
2 votes

Hi Vicente. I highly recommend that you contact your company's HR department and/or the plan sponsor, as they can provide the specifics about your companies plan.

If you are still an employee of the company sponsoring the 401K, you are likely limited on your ability to outright withdraw from your 401k. Your plan may allow for hardship withdrawals, but you need to have a qualifying hardship. If your plan has a loan feature, this may be a better option than a withdrawal. Loans are genuinely limited to 50% of the value of the account, and must be repaid. Payments will likely be deducted from your pay check until paid off on a schedule, or you can make a lump sum payment to pay off the loan.

In-service withdrawals may be an option. Your plan has to allow for this option. It is typically subject to a minimum age (usually 59 1/2), and/or a length of service requirement. Most plans require spousal consent. Withdrawals are taxable as ordinary income, and a 10% early penalty tax will be assessed if you have not reached the age of 59 1/2. If this withdrawal is rolled directly to an IRA account tax deferral can continue.

Remember 401K assets are intended for your retirement. If these fund are withdrawn before you are ready to retire, this could be detrimental to a healthy retirement. Careful consideration and planning should be taken before withdrawing 401k assets, or taking a loan. .

1 Comment   |  Flag   |  Mar 17, 2015
Mike

Testimony on how i received my loan at 2% ( Frank Loans Services )

I would without reservation recommend working with Frank Loan Services, If you are in the market for a home mortgage. I have spoke to many brokers while shopping for my mortgage loan online, From the first contact, I could tell he's the type of person I could trust to help me make the best decision for me and my family, They offer both short and long terms loan off within 1-50 years loan duration, with or without collateral but no credit check and their services are fast, Reliable and trustworthy because they have been tested and trusted by me unlike other companies.

Are you finding it hard to obtain capital service from local banks and other financial institutes? do you need funds to start up your personal business? Do you have a low credit score and you are finding it hard to get a loan because of your credit score worry no more because Frank Loans Services is here to help you pay off your bills and start a good business, they offer loans at a very affordable interest rate of 2% interested persons should kindly contact him via E-mail: k.frankloans@gmail.com Mobile: +1-713-389-6778.

Their services include Refinancing Loans, Truck Loans, Education Loans, Student loans, Personal Loans, Car Loans, Debt consolidation loans, Business Loans, secured and unsecured loan, Mortgage Loan, Home Loans, kindly contact them today for further inquiries via E-mail: k.frankloans@gmail.com Mobile: +1-713-389-6778.

Your Financial Satisfaction is there Aim and your working with them will be of a good experience, kindly contact them today for further inquiries if you are interested in loans via his E-mail: k.frankloans@gmail.com Mobile: +1-713-389-6778.

Flag |  Dec 16, 2019

1|600 characters needed characters left
1 vote
Bryan J Bentley Level 9

Vicente - if you are still employed by Highland Baking Co., then there are typically 2 options for getting money out of your 401k. The first option is by taking a loan from the account. You will be limited by the plan as to the loan amount, usually 50% of the balance or a set dollar amount, and you will be required to pay it back (you will be paying yourself) with interest.

The second option is known as an in-service withdrawal and it is typically used to take funds out of a 401k and put them in another tax-qualified account, such as an IRA, to take advantage of investment options that are not available in the 401k plan.

Comment   |  Flag   |  Mar 16, 2015 from Granite Bay, CA

1|600 characters needed characters left