I'm interested in pulling out my 401k and I want to know how much penalites charges will there be...if i just want to pull out $10k. Essentially all the money in my 401k has been contributed by me because the company i worked for only matched 1%.
2007-08-09 15:00:01 · 5 answers · asked by Peaches 1 in Business & Finance ➔ Personal Finance
There's a 10% penalty for early withdrawl and of course you have to pay income taxes on it. Figure another 20% at least, depending on your state tax rates.
2007-08-09 15:03:10 · answer #1 · answered by bdancer222 7 · 1⤊ 0⤋
I don't recommend pulling money out of your 401K. You will pay taxes on the money plus a 10% penalty. A better option if you need the money is a loan from your 401K. This won't have a penalty and you can pay it back. $10,000 with taxes and penalty could be a lot less - 15% minimum in taxes and 10% penalty - would leave you with $7500. But if you borrow it, you'll get the whole $10,000 and won't pay taxes or penalty, just interest.
2007-08-09 15:06:17 · answer #2 · answered by mamasbooks 2 · 1⤊ 0⤋
Why on earth would you do that???
That is your future you are taking out.
Tou will pay your tax rate plus 10%. That could be as high as 30 or 40% thown away. If you need money, get a loan paying 7% or 8%.
You should NEVER pull money out of your 401(K).
Once you get back on your feet, start saving up an emergency fund so you won't run into this again.
2007-08-09 15:08:55 · answer #3 · answered by Anonymous · 0⤊ 1⤋
Bad Idea.... between the taxes and the early withdrawal penalty you are losing too much!
2007-08-09 15:07:35 · answer #4 · answered by ANGEL Baby 3 · 1⤊ 0⤋
Ouch! You will be taxed at your ordinary income tax rate & penalized an additional 10%. Please reconsider this.
2007-08-09 15:03:11 · answer #5 · answered by Tom's Mom 4 · 1⤊ 0⤋