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| Topic | I'm thinking about cashing out my 401k from my old job |
| Houston 10/17/18 8:57:04 PM #19: | TheKentster posted... Houston posted...To start, your plan provider will be required to withhold 20% for federal income taxes. So you'll get 80% of your 401k right when you withdraw. During tax time, the IRS will assess a 10% penalty and the rest is taxed at ordinary income It's not the worst thing in the world if you're willing to part with the savings themselves. That's the main thing. 401ks are only useful if you're continuing to contribute and your employer is matching you. That's the point. Your employer hopefully contributed well over the amount of the 10% penalty, so that's one way to look at it. You're going to get taxed anyways, and likely at a higher percentage later versus now. Ultimately, though, it's obviously good to keep and save money and let it grow. I'd recommend rolling it over into your new 401k to give you a bigger gains boost. But if you need the money you need the money. Just recognize for most people, thousands of dollars takes time to accumulate and once it's gone it's gone. --- Time keeps on slippin', slippin', slippin' ... Copied to Clipboard! |
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