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401K Withdrawal Rules
Have you changed employers, or are about to?
That are certain basic
401k withdrawal rules
that you should know.
Once you leave your employer, or, as I like to say, if "your employer
leaves you", the rules fall under two
general groups:
1. If you are under 59 1/2
years of age, the general rules are:
- Withdraw your funds with a 10% withdrawal
penalty.
- There is a 20% IRS withholding tax (for your
annual income).
- If greater than $5,000 you can leave it with
your employer.
- You can also rollover the funds into another
tax sheltered program.
2. If you are over 59 1/2 years
of age, but under 70 1/2 years, the
general rules are:
- You can withdraw your funds without penalty.
- There is a 20% IRS withholding tax (for your
annual income).
- If greater than $5,000 you can leave it with
your employer.
- You can also rollover the funds into another
tax sheltered program.
The Primary
Difference
As you can see, the main point is your
age at the time of withdrawal.
There is no penalty withdrawal after you are 59 1/2 years of age.
"The 20% IRS tax applies regardless of your age." However, this is
counted against your taxable annual income.
If you are in the retirement period, then your taxable income may be
less than it used to be. Thus you more than likely would pay less
taxes. Speak to your
tax advisor (or accountant) to be sure--the
regulations on this can and do change.
A Good
Option
There may
be a good option here for you however.
You can put your funds into a program that provides safe, guaranteed
income.
In fact, you can choose the time
periods for your investment...
And you have choices as to the interest
that you receive.
You can do all this with annuities...
An annuity
has significant
benefts to your retirement financial planning.
An immediate
annuity can provide you with steady monthly income within
about a month...
And, a deferred
annuity can grow large until you are ready to retire...
Let our retirement financial advisor review your scenario
and let you
know your options...
Get a good annuity
quote
- let us help guide you
through
the options to make the best choices for you!
Or, get a free consultation from a Certified
Financial Planner to go
over your plans to help you make the best decision for
your needs.
"You'll be glad
you did the right thing."
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from 401K Withdrawal
Rules, to 401K
Planning
Return
from 401K Withdrawal
Rules, to Annuities
Financial Planning
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