- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
401k withdrawals
Posted on 1/28/12 at 10:46 pm
Posted on 1/28/12 at 10:46 pm
I m having a few issues and looking to take out around $15000 from my 401. Never did this before. What is the penalty for doing this?
6
Posted on 1/28/12 at 10:51 pm to arowana
Posted on 1/29/12 at 11:16 am to arowana
You may want to look into taking a "loan" against it for $15k vs. cashing out $15k.
Cashing out comes with significant penalties and taxes, but if you take a loan against it you can set up a payment plan that fits you budget, without the penalties.
Cashing out comes with significant penalties and taxes, but if you take a loan against it you can set up a payment plan that fits you budget, without the penalties.
Posted on 1/29/12 at 12:34 pm to arowana
Most plans won't let you withdraw while you are still employed. If you take out the loan, you have 5 years to pay it back. Money will be deducted from your pay.
This is the primary reason one should not contribute to a 401K (beyond co match) and IRA (except Roth) until you accumulate and maintain a substantial liquid savings account. I know so many people who lost their jobs in 08 and had to sell mutual funds in a down market and then got hit by the .gov. Huge loss.
It ain't money you can use until its in the bank.
This is the primary reason one should not contribute to a 401K (beyond co match) and IRA (except Roth) until you accumulate and maintain a substantial liquid savings account. I know so many people who lost their jobs in 08 and had to sell mutual funds in a down market and then got hit by the .gov. Huge loss.
It ain't money you can use until its in the bank.
Posted on 1/29/12 at 1:28 pm to arowana
Posted on 1/29/12 at 2:47 pm to arowana
10% early withdrawal
4% state tax
20% fed tax
so, of 15k, you will get 9900.00
4% state tax
20% fed tax
so, of 15k, you will get 9900.00
Posted on 1/29/12 at 4:49 pm to tigerdup07
you have no idea what tax bracket he is in.
but yes 10% early withdrawal penalty, fed taxes at your marginal rate, and whatever state tax bracket you are in.
what usually happens is that large withdrawals will put all or some of that money into a higher tax bracket.
dont take it out if you can avoid it. it is usually the most expensive money to take.
but yes 10% early withdrawal penalty, fed taxes at your marginal rate, and whatever state tax bracket you are in.
what usually happens is that large withdrawals will put all or some of that money into a higher tax bracket.
dont take it out if you can avoid it. it is usually the most expensive money to take.
Posted on 1/29/12 at 6:48 pm to arowana
Definitely get a loan if you can. Early withdrawal is very painful.
Posted on 1/30/12 at 7:06 am to foshizzle
The loan interest rates are usually very low on a loan like this. It is def. a good option for emergencies.
This post was edited on 1/30/12 at 10:35 am
Posted on 1/30/12 at 7:21 am to notiger1997
And the interest you do pay goes back into the account.
Posted on 1/30/12 at 10:06 am to PlanoPrivateer
Thanks for the feekback guys, I will look into other options.
Page 1 of 1
Popular
Back to top
Follow TigerDroppings for LSU Football News