General chatter - Retirement fund question!
08-01-2011, 01:03 PM
I have a company paid retirement fund. They add a percentage of my pay each pay period. I really am in need of cash right now for my childs medical bills so he can recieve further treatment. Can I use some of that money or is it locked in to that account?
08-01-2011, 01:05 PM
i think it depends on the company...i know right now DH and i cant access our retirement for the companies that we currently work for (the state of alaska and the school district) but i was able to cash one out at a previous company....it's probably worth looking into
08-01-2011, 01:20 PM
If it's a 401K (or the non-profit equivalent) and you are vested in the account (i.e. you've worked there long enough that the money is your whether you leave the job or not), you should be able to access the money on an emergency basis. There will be big fees and tax implications. If it's a pension fund, public or private, it's less likely you can access it.
08-02-2011, 07:56 PM
Call them and find out...a company I worked for allowed loans up to 50% of what was invested and you agreed to a time to pay it back, up to two years. Worth checking into.
08-02-2011, 08:08 PM
Yeah, there are lots of variables. I know if it's a 401k you have a penalty to pay and must repay the loan within a certain timeframe. Can you talk to your HR/benefits admin person? They'd be able to help you the most.
08-03-2011, 09:23 AM
If it's 401k, then you will have to pay huge penalty (almost 50%) to the IRS if you withdraw before your retirement. IMO, not worth it. Take a loan and pay it off.
08-04-2011, 01:20 AM
Call your HR dept and find out. Like Crystal said, a lot of companies will allow you to take out a loan of up to 50% of the vested balance, and pay it back with interest over time. The interest rate is typically quite low (my company is 3.5% I think?), and you're paying yourself back so it's not as bad. It's a much better option then making a true withdrawal, IMO. But only you know your personal situation and what will be best for you. Get all the facts about your plan from your company first.
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