For those of you that were laid off, or left, after age 55, does the 401k plan offer partial distribution or only lump sum? The SPD doesn't mention. Fidelity states partial is allowed, but says it can't provide documentation since it "could" change.
11 replies (most recent on top)
@442 go to netbenefits and you can download it.
@jj when I retired, I stayed enrolled in the company's group insurance plan which I was eligible to keep until I reached age 65. However, after retiring, within 2 weeks I realized I did not have insurance. When I inquired as to what happened, I was told I was listed as "resigned" . It took 3 weeks of phone calls and threatened litigation before the company capitulated. They admitted a mistake and blamed it on some outsourced agency. I think it's bullsh-t. I'm positive it was done deliberately and they just didn't think I would fight it. If you're still working for L3 harris, keep in mind, you are on your own and your employer is a thug.
@OP i got the termination email but how do I get the SPD? We were not given any info. I can't find it on Command Media either.
@b9 L3H lists all employees over 55 as retired regardless of the reason for leaving. This helps their attrition numbers. The 401k plan does allow partial distributions and it's best to discuss with Fidelity to learn your tax and early withdrawal penalty obligations.
@bc also pretty sure it cant be the sole 401k
You can leave it in Fidelity as long as you like. Even after finding a different job Fidelity will still hold your money and any withdrawals will be taxed. Penalty’s depend on current law on age and other factors that are easily accessible online. Please google on your own before trusting any comments on a layoff forum.
Leave it in the 401k if you want to pull money out without penalties when you are between 55 and 59.5. Do not move it to an IRA, it only works from the 401K. Partial withdrawals are totally normal. The people that taught me about the rule of 55 was Fidelity when I had a one-on-one with one of their reps. I highly recommend you set up a call with the Fidelity rep.
@OP The IRS rule of 55 allows individuals to withdraw funds from their 401(k) without a penalty if they leave their job in or after the year they turn 55. However, this applies only to the current employer's plan and not to IRAs or previous employer plans. Wish you all the best.
I'm not looking for an annuity, I'm looking to see if partial withdrawals are allowed.
Annuity is bad for you. Just leave 401k intact or move to an ira in kind (meaning: don’t cash out to avoid tax)
Don't take the lump sum unless you want to be text heavily. You don't have to take distributions either. Shop for an annuity and talk to a broker there. With a simple phone call, and maybe one meeting, they will move your 401k into a tax sheltered annuity where you can draw the money later.