401k

[reverselogistics]

Can I withdraw money from my 401k to pay an unexpected bill off? If so how do I go about it.

 

[Planosss]

Can I withdraw money from my 401k to pay an unexpected bill off? If so how do I go about it.

You can take a loan...for up to half of your 401k balance, don’t withdraw, you’ll face heavy penalties.

 

[Kartman]

Moron move.

 

[Amanda Cantwell]

Moron move.

not the nicest way of putting it but it is the best way to sum it up in two words.

 

[Kartman]

Bad move.

Is that more PC?

 

[Yetive]

Yes, but less alliterative.

 

[Times Up]

Yes, take a loan...at least that way you can pay yourself interest.

 

[Hardlinesmaster]

I have, you pay $75 fee+interest. I did it online on the target pay and benefits website. The amount depends on how much you’ve saved up, usually you can borrow up-to 1/2 of your savings. It can take up to 7 days to process, you either choose direct deposit or they can send a check. The repayments are spread out , you pay x amount back every pay cycle. Or you can pay it all back at once if you choose.Once you receive the loan you cannot take out more loans until the current one is paid off. The process is fairly simple.
Most financial advisors recommended against borrowing money from 401k, because some people are unable to repay the loan and you actually pay interest instead of earning it.
I had borrowed a small small amount and paid it back in a few months. I barely noticed the small deduction every pay cycle.
I hope you make it out of your slump, stronger. Just hang in there.
Thanks
Humble tl

 

[Anelmi]

Sometimes life throws a lot at you and you gotta do what you gotta do. I have had to take a premature withdrawal (my 401 k elsewhere doesn’t give the loan option) and while not good, it is saving me from far worse financial damage. I got charged 10% off the top for taxes and then will have to add the total to my earnings and pay taxes again. So if you have the option for a loan and can pay it back while still employed at Target, that’s obviously a better choice.

 

[reverselogistics]

Thanks for all of the information it was really helpful.

 

[TTB]

I have also taken out the 401k loan my payments were only 20 something every paycheck and you can also pay it all back at once which helps once you get your balance low enough...once you pay it back you can take out a loan again if you ever need to in the future.

 

[spotlessmind]

Something to keep in mind. If you quit or get fired you will have top pay it back by the next quarter, i believe.

 

[Planosss]

Something to keep in mind. If you quit or get fired you will have top pay it back by the next quarter, i believe.

What happens if you don’t? Doea it go into collections?

 

[Anelmi]

I think it's treated as a premature disbursement.

 

[tellmeaboutatime]

At a certain age (59 1/2) the penalties for withdrawing from your 401k are waved up to 10k You still have to pay the tax on it.