How bad is it to withdraw money from 401(k) before retirement?

It is a very common question in the world of retirement planning: Can you withdraw money from your 401(k) before you actually retire? read more

I don't think it is a very good idea at all to withdraw money from 401k before retirement. You will be paying a 10% extra penalty fee on top of your regular income tax. Let's assume you are in the 25% tax bracket, you will have to pay $35 in taxes for every $100 you take out. That leave you with only $65 for every $100 you withdraw. read more

Below is a summary of different ways to withdraw money from your 401(k) plan prior to retirement: Withdrawal from 401(k) Before Age 59½ While you have the right to access your 401(k) contributions and their earnings at any time, if you make a withdrawal before age 55, you are likely going to face some steep penalties. read more