Investing

A 401K is a RETIREMENT savings account...it is not a school account.

If you make withdrawals prior to retiring you will be charged a penalty as well as paying additional taxes to the IRS...

I understand that the cost of working right now is more than you could make as I am in that situation as well. I work for the benefits and because I continue to contribute towards my retirement plan and social security after paying for my two in daycare.

However, I would strongly advise you to not spend your 401K money unless you are absolutely out of choices. Consider putting your 401K into an IRA. Again, I would not touch it - you will have at least a 10% penalty plus you will have to pay taxes on any income from it. It is possible to pay upwards of 50% on the money before any of it is "spendable". There are loans available to pay for school but there are no loans available for retirement.

I am a financial planner so let me know if you have further questions.
C.

Most accesible place to put it? In your local bank. But tyou will earn no money on your 401k. I would invest it in high dividend stocks.

If you don't know which stocks, I'd get with a broker for suggestions. I'd also use a low commission stock broker like Scott Trade. If you don't know anything about the stock market, learn. Money magazine will give you a basic education in stocks.

I like dividends. I have my investments in high dividend stocks like AGNC, NLY, T, ETP.

Good luck to you and yours.

Where is the money now? Most employers make you transfer it when you terminate.

Most people roll it over into an IRA. Depending on the structure you can have just as much access to it as you did when it was in 401k form. Regardless of where you put it you will pay taxes on it when you withdraw. Depending on the reason for withdrawn you may also have a penalty.

You should have been advised when you quit your job what your options were.

What momceo just advised will get you double taxed if you get caught. You cannot transfer through gift or otherwise that that you have never been taxed on in the first place. There are a lot of things you can do and chances are if it is a small amount you won't get caught. If you do get caught it will probably cost you everything in your account. If you are not the gambling type be very careful.

I'm not sure about the other stuff but I know that you can withdraw money, penalty free, for some things like buying your first house.. I used to work for a CPA and was more learned on the specifics but it's been a while. You should be able to look up a FSA in the phonebook and they will talk to you for free.. good luck

I believe in addition to the taxes you would have to pay on the money you withdrawal there is also a 10% penalty. You would probably be better of taking out a loan to pay for school.

The first thing to do to plan for financing school is to fill out a FAFSA application. This will tell you if you qualify for student loans. With most student loans, you don't have to start making payments until six months after you complete your education.

You can also usually take a loan from a 401k without any penalty.

Taking money out of a 401k incurs a 10% penalty on top of the income taxes you may have to pay depending on your tax situation.

I think you need to look at the penalties you might incur from removing that 401K money before retirement. You might want to roll it to another 401K fund. Talk to the financial adviser at your bank as a place to start.

.

DO NOT get student loans. I ended up spending 10 years paying them off. The interest compounds. It is not a flat 5 or 8%. It keeps growing like your mortgage.

IRA because kids' tax bracket is usually very low or nonexistent "if the kids are old enough to work" is that all money that is put into a ROTH IRA must come from kids' own earned income. It can't be money that is a gift or is earned from dividends or interest or from any other investment. If your child is old enough to earn some money by doing odd jobs, then that can go into this Roth.

If it is a 401 K, and if you acces it, you will pay taxes through the nose. 401K's are not to be accessed.

There are special provisions in place that you can borrow from your 401k HOWEVER, it must be replinished in FULL within 90 days or something like that or you reap the tax consequences.

If you are not a money person and don't know many of the ins and outs of investing, PLEASE, go to a good financial advisor. There are a lot of loopholes where you can switch the 401K to another type, etc but you need a professional guiding you through this so you are not out monies for taxes, commissions, etc.

We on this site can only give opinions and we are not financial advisors. You need a professional if you are considering touching your 401K.

Your 401(k) is NOT supposed to be accessible. It's a long-term savings vehicle. Please tread very carefully when considering accessing those funds.

You will have to pay income tax on what you withdraw (plan on 20%, could be higher or lower at tax time depending on your tax bracket) plus a 10% early withdrawal penalty. So you are losing 30% right off the top. Student loan interest, even after you compound it, would be much lower than 30%. There are lots of ways to pay for school and very few ways to pay for retirement. Unless you have some bulletproof retirement plan (a pension that will never be cut or taken away) you should really only tap into your retirement savings as a last resort - literally, to keep a roof over your head or pay huge medical bills.

As a former employee, you can withdraw your money any time. If you withdraw it, within a week of requesting the withdrawal you will simply be sent a check for the current value of your account, minus 10%, and then will have to set aside 20% to cover a ginormous tax bill next year (because your taxable income will increase by the amount you withdraw). You can then do whatever you want with the check - stick it in the bank earning nothing, open up a CD or Money Market account so that you're at least earning something, put cash under your mattress, whatever.

If you want to roll over to an IRA you can do that as well without the taxes and penalties, but your money is no more accessible in an IRA than it is in your 401(k) and an individual IRA may have higher fees because you as an individual investor would most likely be paying higher fees than the company you worked for, which negotiates lower fees in return for lots of accounts. IRAs are good for when you want to consolidate monies from multiple accounts, when you don't like the investments in your 401(k) plan or when your 401(k) plan has higher fees than you can get on your own. That said, an employer 401(k) plan is often much more robust than an individual IRA (liken this to the difference between buying health insurance on your own vs. through work - the work plan usually gives you more and costs you less). They usually have better investments with better share classes, robust web sites and good customer service, services like automatic rebalance, and some even offer investment advice.

If you decide to leave your money where it is and are concerned about the "safety," many plans now offer target-date funds that are pre-allocated based on your expected retirement timeline. So if you're currently 35 and plan on retiring at age 65, you would pick a 2040 fund. This would put you in an appropriate mix of stocks, bonds (and maybe even cash/stable value) now that will automatically grow more conservative as you age. The "safe" fund in your plan is probably a stable value fund or money market fund and while the goal of those is to never lose money, you will never earn enough in those to keep up with inflation or earn enough to retire, so make sure you haven't parked your money there because you didn't know what else to do with it.

Hope this helps!

ETA: As a terminated employee, borrowing from your 401(k) is not an option. That is only for current employees of a company. I know that you didn't ask that but a couple of people mentioned it in the comments.