My wife just recently got laid off and wants to retire early. She is ELLIGIBLE to retire at 55 1/2. We will live off her 401k and pension and per my estimations that money will only last 6 years.
I’ll be 58 or 59 when this money will run out and will need withdraw money every year out of my 401k till I retire at 65 or 67. Can u do this? I know many companies allow it but not sure about Att. Anyone know?
It’s not rocket science. Research a little. It’s very easy nowadays with the internet.
You don’t even need to spend money with a financial advisor.
If you are under 591/2 you can not take systematic withdrawals if still working. The rule of 55 (72T) only applies if you leave the company. but that comes with strict requirements to substantially equal periodic payments. The amounts will be based on your account size and not your needs. You may be eligible to roll a portion of the account to an IRA. However, if you take early withdrawals (before 59 1/2) from your IRA, you will be subject to a 10% penalty, federal tax at your marginal rate and potentially SALT (state and local income taxes). The combined rate could easlily reach 40%. That would leave you 60 cents on the dollar not mentioned robbing you of future growth on any funds you prematurely withdrawal. So, the cost is really much, much more that the 40% immediate tax. The true cost is in lost opportunity and that is very hard to measure - just rest assured it it WILL be significant. Please exhaust all other options first. Good luck.
There are several other options, but the best option is DO NOT hit that money if possible.
Try to get a job and continue to work until 62 year. Rollover the 401k and pension to an IRA and let it growth until she is 62 year. You will thank me later. Can't live on Social Security alone.
Get a job you lazy POS
Here is the info you seek!
https://www.thebalance.com/what-is-the-rule-of-55-2894280
https://thefinancebuff.com/age-55-no-penalty-withdrawals-from-401k-plan.html
See additional exceptions in the middle of the page here!
https://www.irs.gov/taxtopics/tc558
Get advice (usually free), make a plan and stick to it!
Strange place to ask for advice like this. Normal age to withdraw penalty free from 401k is 59 1/2. Younger and you face a 10% penalty in addition to it being taxed as income. There are some exceptions to this, if you are laid off and 55 years old you can google the rule of 55 and look at that. But you really need to talk to a financial advisor.
Yes, you can make withdrawals with the amounts varying depending on your balance. I believe there is a 20%. Penalty. Speak with Fidelity and as the previous poster stated a financial advisor as well
See a financial advisor to minimize your penalties