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How do I withdraw my balance?

Mar 05, 2012 by David from Fargo, ND in  |  Flag
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Hi David,

Are you asking about an IRA or another type of retirement plan, such as a 401(k) or 403(b)? The type of plan and the type of withdrawal would affect the answer.

If you plan to simply remove the funds from a retirement plan, be aware you may need to pay taxes. If you are under 59-1/2, there may be federal and state penalties as well. For an IRA account, taking a distribution (or withdrawal) is fairly easy. Just contact the comapny or bank that holds your account.

Some retirement plans (such as 401(k) plans) may not allow a withdrawal except under certain circumstances, but may allow a loan. You will need to contact your HR representative to see what your plan allows.

If, however, you are asking for a way to move your retirement account from a previous employer's plan (or from an IRA to another IRA), then I would suggest you do a custodian to custodian transfer. This is generally the safest way to go from a tax perspective. You don't need to worry about the 60 day limit, and if you are moving money from an employer plan, you won't run into the 20% withholding requirement.

A rollover from an employer's plan to an IRA, or a transfer from an IRA to another IRA, is a simple process. If you plan to manage your funds yourself, the on-line firms can help you through the paperwork. If you plan to work with an advisor, they will likely handle the paperwork for you.

Comment   |  Flag   |  Mar 05, 2012 from Permanente, CA

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