"It
sometimes seems easy solution to cash out your 401(k) to solve a
financial emergency.
However, think before doing that.
There are some consequences to withdraw your 401(k) before 591/2 years
of age:
You may have to pay 10%early withdrawal penalty
You have to pay federal income tax"
You
can, but you shouldn’t do it because it’s a bad financial idea. Once
you cash out from your 401 (k), it's gone and it will be difficult to
replace it with other savings. However, if you are under 59 ½ years,
then you have to give 10% early withdrawal penalty along with tax
charge.
If you’re above 59 and facing the worst financial phase like credit
card debt and you’re thinking to cash out from your 401 (k) to resolve
the issue, then I would like to suggest taking out a loan is a better
option than eating all the savings. But, you have to cross the age
limit, and understand the terms of the loan before making any final
decision. I would like to suggest you to talk to a financial advisor in
person regarding the matter.
However, think before doing that.
There are some consequences to withdraw your 401(k) before 591/2 years of age:
You may have to pay 10%early withdrawal penalty
You have to pay federal income tax"
Sub: #1 posted on Mon, 06/06/2016 - 21:40
Moderators
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If you’re above 59 and facing the worst financial phase like credit card debt and you’re thinking to cash out from your 401 (k) to resolve the issue, then I would like to suggest taking out a loan is a better option than eating all the savings. But, you have to cross the age limit, and understand the terms of the loan before making any final decision. I would like to suggest you to talk to a financial advisor in person regarding the matter.
Sub: #2 posted on Wed, 06/22/2016 - 05:37
(Posts: 787 | Credits: )