How can I pull money out of my 401k for investing my home?

Answer 1

You have a bunch of good answers, submitted before mine, but let me add my two cents.
Until you are 59 1/2 you can't take money out of you 401(k) except for some special exceptions and for those you need to check with your plan administer. After you separate for the company and before you are 59 1/2, some plans have ways to withdraw money from the plan without paying penalty, but you will pay taxes.
Now assuming you are under 59 1/2 and still working for the company and you don't meet the special exception rules of your plan, you have been given the ways get money out of the plan. I will give you some things to think about.
1) Most plans you can take out a loan on your plan. Today that loan will charge you between 7.5% and 10.5% interest, but all of that interest goes back to you. So if your plan is growing less than 7.5% to 10.5% per year, this might be a good deal.
2) Another problem is that the amount you borrow is limited - sometime 50% of your vested amount up to an amount like $50,000. That may not be enough.
3) The loan is form a specific period of time, generally no more than 5 years. If you leave the company will you have the loan, the balance of the loan can be considered a distribution and you will have to pay taxes and penalty. You don't want to do that.
4) If your money in your 401(k) is invested properly, it is growing faster than most markets' real estate prices. Why would you move your assets from an asse with a higher return to an asset with a lower return. If it isn't growing faster, move it to assets inside the 401(k) that are.
Me - I would save money for the down payment on a house. An then buy a house.

Answer 2

This is definately a question to ask your plan holder, however I can let you know a little about it. In most cases pulling money from your 401k before retirement ages is never a good idea. The reason is because you haven't paid taxes on t his money yet, and so now guess what . . You are taxed, and penalized for the early withdrawl. Unless you are in dire need of the money and can take a "hardship withdrawl" or the plan offers a loan option. The hardship withdawl still has the taxes and penalties that come with an early withdrawl. Some retirements allow you to take a loan out of your 401k , however you have to pay it back. This usually is your best option because you have to pay yourself back and then some interest. So it works out well, however I don't know if there are cots or fees associated with this type of loan. Either way good luck, and remember each plan is different so you may want to call your planholder and be sure.

Answer 3

Unless you r 62and a half that would be really stupid move. You will be taxed 33 and a third percent for the money you pull from your 401K. Your best bet is to see first if you apply for help from the gov. Then try opening a building fund or use the stock market or some sort of bond to get the money for you. There are many different ways but pulling money from a 401K for any reason but retirement is completely unheard of.

Answer 4

While currently working at your employer, you are not able to take distributions. However, there are probably loan provisions available. This means that you can withdraw a certain percentage of your balance (or a certain amount if your balance is high enough) as a loan.

Two things to keep in mind. You will pay YOURSELF back with interest rather than pay a bank that same interest. The downside would be the fact that your money won't grow if it's not in the 401k.

Answer 5

the main crucial retirement investment after the 6% that the corporation suits, is the ROTH IRA. you're allowed to put in $5000 each and each 3 hundred and sixty 5 days, and that funds grows till you retire. at that ingredient, you pays NO TAXES. that's the reason you will possibly be able to desire to start up the ROTH. there are a number of ROTH investments, yet once you do not comprehend, or comprehend making an investment, permit a Mutual Fund do the artwork for you. a minimum of till you extra effective comprehend the industry. the different investment is difficulty to taxes, and capital helpful components taxes. You talk of crashes. The industry has basically recovered from the 2009 "crash". human beings panic, however the certainty of the priority is the industry is going up and down continuously. large down turns are a element of the inventory industry. The trick is to be in for the long haul, and not take your funds out while it crashes. via leaving it in, you will regain your losses, as your funds grows to new heights after the "crash".

Answer 6

You need to contact the Plan Administrator (ask your employer) If this is a plan is just sitting there inactive then you would want to roll it over into another investment more than likely. If you take any money out then there will be penalties and tax considerations possible. It can be done but think of the reasons why and look into other alternatives. I suggest contacting a financial professional. Look at primericafna.com

Answer 7

If you can avoid it do not do it ever. you will lose too much money and the benefit of the program. yo are much better off taking a loan you get a tax benfit instead of a burden

Answer 8

You need to contact your 401(k) provider and ask them to talk you through their paperwork. It is very important that you tell them why you are taking money out. It should be pretty straightforward.

Answer 9

close the account.
you live only once.