Have public safety retirement now should I cash in my 401k?
May 27, 2010 by MrAuthor
Filed under Public Safety
recentlty got hired by fire department and was thinking about cashing in my 401 to pay of bills since I have public safety retirment. Was wondering if good idea or not I also already have a roth ira I invest in.
There is no such thing as having too much money saved for retirement. So, do not use your 401K to pay bills.
DO request a direct rollover of your 401K to an IRA. The company that holds your 401K is likely to be charging you very high fees – which they do not even have to disclose by law. If you do a direct rollover, you will not have any tax withholding taken and you will have more choices for how to invest. I recommend you check out Vanguard.
If you did cash in your 401K, you would be subject to a 10% penalty (if you’re younger than age 59 1/2) plus regular income tax on the distribution. Not a good deal!