Q:

How do you make a withdrawal from a 401(k)?

A:

Quick Answer

To make a withdrawal from a 401(k) retirement plan, borrowers must contact the human resource office of the employer or the investment company hosting the plan, complete a withdrawal form and provide reasons for the withdrawal if younger than 59 1/2. Fees may apply when withdrawing funds early.

Know More
How do you make a withdrawal from a 401(k)?
Credit: Dennis Novak Photographer's Choice Getty Images

Full Answer

As of Oct. 2014, individuals withdrawing prior to retirement age can request a hardship withdrawal to cover the cost of medical expenses, school tuition, funeral costs, a home purchase or to prevent eviction or foreclosure. When withdrawing from a 401(k) plan for a hardship loan, the borrower is subject to a 10 percent IRS penalty and income taxes.

Learn more about Financial Planning

Related Questions

  • Q:

    How do you plan for retirement in South Carolina?

    A:

    Individuals who work for the state of South Carolina can inquire with the South Carolina Public Employee Benefit Authority to determine retirement plan options that may include investment consulting services, according to the South Carolina Public Employee Benefit Authority. People planning for retirement in South Carolina should set goals to save enough funds that equal 70 percent of preretirement income to maintain a standard of living once retired, recommends the U.S. Department of Labor.

    Full Answer >
    Filed Under:
  • Q:

    What is the TSP retirement plan?

    A:

    The Thrift Savings Plan is a retirement savings and investment plan designed for federal employees and members of the uniformed services, explains TSP.gov. It is a contribution plan, meaning the available retirement money is dependent upon the funds accumulated during the years as an employee.

    Full Answer >
    Filed Under:
  • Q:

    What is Mercer Investment's 401k plan?

    A:

    Mercer maintains its investment 401(k) by managing defined benefit plan risks, generating high-performance defined contribution plans and preparing clients for retirement. It has developed complex systems to counteract common challenges in its investment 401(k) plan, as Mercer reports.

    Full Answer >
    Filed Under:
  • Q:

    What are some differences between a 401(k) and an IRA?

    A:

    Differences between a 401(k) retirement plan and an individual retirement account include eligibility for participation, maximum contributions allowed and investment options, according to Investopedia. Differences in eligibility and tax treatment also exist between the two types of IRA accounts, traditional and Roth, notes U.S. News & World Report.

    Full Answer >
    Filed Under:

Explore