Withdrawals

The ideal way to access your retirement accounts is to reach the age where you can withdraw the money without penalty. If you are 59 ½ you can legally access the funds in your retirement accounts without paying penalties and additional taxes. However, if the funds are not from Roth retirement accounts, you can raise your taxable income, so you should set aside additional money for your taxes. You can set up a monthly payment amount that you receive or simply withdraw a lump sum for the year.

Find out the different ways you may be able to access your retirement funds…

Accessing Your Money

The best time, of course, to access is your account is when you retire. However, sometimes you may need to access your savings before you retire. In such situations, subject to plan rules, you may be able to take a withdrawal or a loan

Because your employer's plan is a retirement savings plan, distributions before retirement (including withdrawals) are limited by federal law. Access to your account is generally available as follows:

403(b) plans 457(b) plans 401(a) plans
At age 59½ At age 70½ At age 59½
You no longer work for the employer that sponsors the plan You no longer work for the employer that sponsors the plan You no longer work for the employer that sponsors the plan
Financial Hardship Unforeseeable Emergency Yes - If you're in a profit-sharing plan
Death Death Death
Qualified Domestic
Relations Order1
Qualified Domestic Relations Order1 Qualified Domestic Relations Order1
     
1 A Qualified Domestic Relations Order (QDRO) is a court order that outlines the requirements for splitting your retirement savings plan funds in the case of a divorce or for payment of past due child support. A QDRO should specify the percentage or dollar amount to be distributed to the ex-spouse or other designated alternate payee; the date of the account valuation; how the money should be distributed; and the responsibility for any outstanding plan loans. It should also consider annuity contract or custodial account features, charges, etc. For example, not all accounts can be divided on a percentage basis.

Under federal law, required minimum distributions must begin by April 1 of the year after you either attain age 70½ or sever employment with the employer that sponsors the plan, whichever comes later.

Amounts withdrawn may be subject to ordinary income taxes and your investment provider may also apply a withdrawal charge. Amounts withdrawn from 403(b) plans before age 59½ may also be subject to a 10% federal income tax penalty. Other taxes may also apply. Speak with your tax advisor for information on your specific circumstances.

Account Access

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