{"id":1752,"date":"2008-04-23T05:00:24","date_gmt":"2008-04-23T12:00:24","guid":{"rendered":"http:\/\/getrichslowly.org\/blog\/?p=1752"},"modified":"2023-09-28T15:51:30","modified_gmt":"2023-09-28T21:51:30","slug":"i-quit-my-job-what-should-i-do-with-my-401k","status":"publish","type":"post","link":"https:\/\/www.getrichslowly.org\/i-quit-my-job-what-should-i-do-with-my-401k\/","title":{"rendered":"I quit my job — What should I do with my 401k?"},"content":{"rendered":"
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<\/b><\/i>When you leave your job, you have several choices regarding your 401(k). These options for a 401(k) rollover are pretty much universal, meaning they apply to every 401(k) and to every job change situation. Your options are:<\/p>\n I’ve listed this option first because it has the most serious ramifications.<\/p>\n First, if you take a full payout, you will have to pay taxes on the plan \u2014 usually 20% off the top when you take the money out, and a 10% penalty when you file your taxes if you are below the age of 59-1\/2.<\/p>\n Second, if you have no other retirement plan and you take a pay-out on your 401(k), then you now have no more retirement money. You must start again from the beginning, and this puts you behind.<\/p>\n If you take a full payout but then decide you shouldn’t have done so, there’s still hope. The IRS has provided the 60-day rollover rule, which allows you take the money you withdrew from your 401(k) and roll it into an IRA within 60 days. You still pay taxes at the time you take the money out of the 401(k), so it’s your responsibility to find the cash to bring the IRA contribution to the level of your 401(k) withdrawal. However, when you file your tax return, you get a credit for the taxes on the 401(k) and for the 10% penalty. (Documentation is<\/i> required.)<\/p>\n<\/span>Cash the 401(k) Plan and Receive a Full Pay-Out<\/span><\/h2>\n