If you take it all out, it’ll be taxed if it’s not a Roth. You’ll also be charged 10% extra if it’s before the age specified. You can call them and ask what the ramifications are. If you withhold, WH the 10% plus 25% of the withdrawal to cover the tax.
You don't take it all out at once. You take it out in amounts that you won't be taxed. I've come to find that real estate is a much better investment over the long haul because it pays you plus grows in value.
The house always wins whenever it crashes. Most stocks go back up, especially the ones in 401ks. If you put it money for retirement for a long time and didn't cash out desperately, you'll have a lot. Take out most or all of it now if you're uncomfortable. Buy gold and silver. Stock up non-perishables.
What you do is not buy into the flavor of the month. You keep it in for the long term. You dont know if some thing absolutely glorious happens a year from now.
There usually are different investment options such as money market or bonds. You won't make much, but you also won't lose much. Your best bet it to leave it alone. If your 25+ years into it. Somewhere around 55 to 60 start moving into money markets.
Most plans now allow for an in service withdrawal to a rollover IRA without tax penalty. You can always purchase CDs from your local credit union at that point from inside your IRA rollover if you don’t want to enrich Wall St bankers.
Otherwise, or if unavailable in your plan you can always quit your job or retire (separation of service) as this is the only other option to roll it out this escaping the 10% early withdrawal tax penalty. Some other options are plan loans, first time home purchase, disability and possibly education for kids, I forget.
Just a side note:
From a financial planning perspective contributing to the plan allows you to reduce your taxable earnings by the amount you contribute lowering your taxable income/tax burden in that year. The offset or long term benefit is that these investments grow tax free while in the plan, yet Uncle Sam always gets his piece eventually (once assets get distributed from the plan itself if not rolled over to an IRA Rollover). At 72 eventually you’re forced to take out what’s called an RMD or required minimum distribution so that it can be taxed from the IRA Rollover as income. There are a few ways to give these assets to beneficiaries to then lower this tax burden, yet your kids or surviving spouse will ultimately get taxed, just at a lower amount. Of course this later option is only for those who don’t need their retirement assets.
I advise you keep it in and continue to dollar cost average and grow your retirement nest egg per contributions as this is the easiest way to lower taxable income, grow assets tax free and at the same time have access later supplementing an unknown availability of social security benefits in retirement. You don’t have to buy mutual funds in the plan or participate in the stock market perse. There is usually an option for a money market fund (though brokerages use these to finance margin loans to clients, traders, etc) as a low interest more stable option, but this is like having a bank account at an investment bank they use on the backside to financially engineer more dough. Some plans now have a guaranteed fixed annuity, CD option or other guaranteed option, but that’s rare.
The purpose in theory is to have for future and when you don’t work so if you work normally and have 50k wage for example, you can withdraw 50-75k or so of investment income in the years your not working and pay the same level of tax and live off your earnings. Obviously used 50k as an example and the reason I said 50-75k is investment income is taxed lower then employment income in Canada and I am insure if the same situation in the States.
Also, fuck shares, buy what is truely valuable, land.
Still better than monopoly fiat petrodollars. That may change soon but not really. The way you get fucked is you panic sell when it crashes. Diversification and active financial literacy and management is how you try to at least keep the money you made, sometimes you do make a profit. It’s good to base your system around what you intend to spend your money on and estimate what it will cost
If you take it all out, it’ll be taxed if it’s not a Roth. You’ll also be charged 10% extra if it’s before the age specified. You can call them and ask what the ramifications are. If you withhold, WH the 10% plus 25% of the withdrawal to cover the tax.
Maybe buy precious medals, I don’t know
Here is a precious medal!
You don't take it all out at once. You take it out in amounts that you won't be taxed. I've come to find that real estate is a much better investment over the long haul because it pays you plus grows in value.
You’ll be taxed no matter the amount
Take out $100, you’ll be taxed on that plus a $10 penalty
Put it into a stable value fund. It's usually mostly tbills. This way they can't touch your money while you watch it all burn.
Crypto maybe...
All crypto except the federal reserve coin will be banned soon, Mark my words.
We are slaves, friend. Literally
On the bright side, everything else is a scam, too!
The house always wins whenever it crashes. Most stocks go back up, especially the ones in 401ks. If you put it money for retirement for a long time and didn't cash out desperately, you'll have a lot. Take out most or all of it now if you're uncomfortable. Buy gold and silver. Stock up non-perishables.
The stock market has always been scam. It's a game of musical chairs.
The idea has always been able to cash when the music is playing.
Take all the dough back out? I don't have a 401k, so I really don't know how they work...
Huge tax penalties for early withdrawal.
...so the Government is directly responsible. Why am I surprised?
Pull it out and invest in AMC, Nokia, and silver?
I put mine in bonds just before Biden was elected, I wont earn much but also stand to lose little when the market tanks.
What you do is not buy into the flavor of the month. You keep it in for the long term. You dont know if some thing absolutely glorious happens a year from now.
There usually are different investment options such as money market or bonds. You won't make much, but you also won't lose much. Your best bet it to leave it alone. If your 25+ years into it. Somewhere around 55 to 60 start moving into money markets.
Most plans now allow for an in service withdrawal to a rollover IRA without tax penalty. You can always purchase CDs from your local credit union at that point from inside your IRA rollover if you don’t want to enrich Wall St bankers.
Otherwise, or if unavailable in your plan you can always quit your job or retire (separation of service) as this is the only other option to roll it out this escaping the 10% early withdrawal tax penalty. Some other options are plan loans, first time home purchase, disability and possibly education for kids, I forget.
Just a side note:
From a financial planning perspective contributing to the plan allows you to reduce your taxable earnings by the amount you contribute lowering your taxable income/tax burden in that year. The offset or long term benefit is that these investments grow tax free while in the plan, yet Uncle Sam always gets his piece eventually (once assets get distributed from the plan itself if not rolled over to an IRA Rollover). At 72 eventually you’re forced to take out what’s called an RMD or required minimum distribution so that it can be taxed from the IRA Rollover as income. There are a few ways to give these assets to beneficiaries to then lower this tax burden, yet your kids or surviving spouse will ultimately get taxed, just at a lower amount. Of course this later option is only for those who don’t need their retirement assets.
I advise you keep it in and continue to dollar cost average and grow your retirement nest egg per contributions as this is the easiest way to lower taxable income, grow assets tax free and at the same time have access later supplementing an unknown availability of social security benefits in retirement. You don’t have to buy mutual funds in the plan or participate in the stock market perse. There is usually an option for a money market fund (though brokerages use these to finance margin loans to clients, traders, etc) as a low interest more stable option, but this is like having a bank account at an investment bank they use on the backside to financially engineer more dough. Some plans now have a guaranteed fixed annuity, CD option or other guaranteed option, but that’s rare.
Good luck.
OP:
The purpose in theory is to have for future and when you don’t work so if you work normally and have 50k wage for example, you can withdraw 50-75k or so of investment income in the years your not working and pay the same level of tax and live off your earnings. Obviously used 50k as an example and the reason I said 50-75k is investment income is taxed lower then employment income in Canada and I am insure if the same situation in the States.
Also, fuck shares, buy what is truely valuable, land.
Still better than monopoly fiat petrodollars. That may change soon but not really. The way you get fucked is you panic sell when it crashes. Diversification and active financial literacy and management is how you try to at least keep the money you made, sometimes you do make a profit. It’s good to base your system around what you intend to spend your money on and estimate what it will cost