Laid Off? Check Your Severance Pay Stub!

[Anonymous]

Actually this is not true. If you leave after turning age 55, withdrawals are NOT subject to the 10% penalty if left in the 401K as they would be if rolled over to an IRA until the year you turn 59 1/2. Withdrawals are subject to income tax as you state. Of course this is the same as for the IRA vehicle, unless the IRA is a Roth, in which case you'd pay the taxes on the front end.

So the trade off for increased investment flexibility for those over 55 gained by rolling it over is knowing you'll have to pay a 10% penalty on withdrawals if they are needed before 59 1/2.

You can do a partial roll over into an IRA. I am considering rolling most of my 401K into an IRA, but leaving some in the 401K, just in case I might want to make an non-penalized withdrawal prior to reaching age 59.5.

 

[Anonymous]

You can do a partial roll over into an IRA. I am considering rolling most of my 401K into an IRA, but leaving some in the 401K, just in case I might want to make an non-penalized withdrawal prior to reaching age 59.5.

Excellent point

 

[anonymous]

Dumbshit

I was going to call you anonymous asshole but dumbshit works, if you identify more with dumbshit.

 

[anonymous]

So you waited over 3 years for that?

 

[anonymous]

spparently, revenge is a dish served very cold.

 

[anonymous]

So you waited over 3 years for that?

He was probably on hold with HR for 3 years, that's why.