I am not at retireent age. I am unemployed with no health insurance.
Jamil thank you for your question. It is so difficult to navigate through the 401(k) maze. As someone who is currently unemployed and at this time with no health insurance, it may not be your best time to worry about plan fees. Sounds like your former employer, to create liquidity, needs you to move to a different platform to initiate your request. Have your plan administrator walk you through the process of hardship withdrawal to take care of all the paperwork and tax implications.
This is a very broad question and hard to answer exactly what you are looking for. However, it sounds to me like your employer would like you to rollover your 401(k) to an IRA of your choice. If you are looking for a conduit to roll your funds to and then immediately take a withdrawal, you can always open an IRA at your local bank. Once your accumulation is in an IRA, you can than take a distribution. Of course, be aware that your distribution will most likely be subject to ordinary income tax and a 10% early withdrawal penalty. You can always seek advice from the bank or company opening the IRA for you. I hope this helps.
Jamil, I think you are trying to say you have participated in your employers retirement plan and have invested in the company’s stock, that you no longer work there, and need to take a partial withdrawal. Yet you still want to keep what is left in company stock.
Typically other than non-public shares of your employers stock, you would not have non-public shares of a company inside your 401(k). If you have your former employers stock, there may be rules on when and how you can sell it. Call HR and get the phone number to contact the plan administrator to find out what your options are.
So once you sell your company shares, your company may not even offer hardship withdrawals, and even if they do, there are strict rules. And that doesn’t matter, because as a former employee, I don’t believe you would be eligible for hardship. You would have to pay income tax on the withdrawal plus a 10% penalty.
Non-public shares are very hard to sell, as you are about to find out. The company may be doing very well, but if you can’t find someone to buy the stock, it may not be the best investment. I would suggest you try to liquidate all the shares. Speak to a local financial advisor that you feel comfortable with, open a rollover IRA, transfer your entire 401(k) to the IRA. If you need to make a withdrawal, you could do so; you are still subject to income taxes and the 10% penalty. Fees only matter in the type of investment you would be investing in, in your IRA. It has nothing to do with trying to transfer your funds. I believe you have no options; you just need to pay whatever fees there are and get out of this plan.