Has Anyone Cashed Out Their 401(k)?

[HornPorn]

Cashing out a 401(k): Would love to hear how old you were when you did it, how you rationalized doing it, how old you are now and if you are still glad you did or not?

 

[Bannedinshortorder!]

Unless you are investing in a money maker that will offset the penalties then don't do it.

 

[Svivian]

I took out a giant heloc to go on some sheep hunts and I needed the funds so I cashed out my 401k

 

[MallardSX2]

At 40 I cashed out my 401(k) to be able to afford multiple guided sheep hunts.

You only live once Brah...or Braw or Bro or however the F people say it....

 

[MallardSX2]

I took out a giant heloc to go on some sheep hunts and I needed the funds so I cashed out my 401k

Damn. You beat me. lol

 

[realunlucky]

I really dislike the off "asshole" season please reel yourselves in.

Sent from my SM-S926U using Tapatalk

 

[mlevimadden]

The IRS makes it painful to withdraw/cash out a 401k for reasons other than retirement income from both a tax burden and penalty standpoint. The only instance I would ever consider this as an option would be if it fell under the IRS hardship distributions guidelines and I was looking at potential bankruptcy, truly a last resort option.

If I'm looking to scrape together funds, touching a traditional IRA or 401k account is going to be the last account on the list. This may be different for your situation if you're over 59 1/2.

One of my close hunting buddies cashed out his 401k after every job he left. His finances were a mess (camper loan, side-by-side loan, vehicle loans, home loan, paycheck-to-paycheck and frequently overdrawing his account) and is not an example I would want to follow for financial wellness.

 

[Laelkhunter]

At 40 I cashed out my 401(k) to be able to afford multiple guided sheep hunts.

You only live once Brah...or Braw or Bro or however the F people say it....

Bruh

 

[Poser]

The first example that comes to mind is someone I know of who cashed out their entire 401k to open a Crossfit box. The gym last about 4 or 5 years before closing shop. The equipment was liquidated for pennies on the dollar and I think they got stuck paying their lease for months after closing.

 

[Taudisio]

I withdrew my retirement when I left a job after 2 years when I was 24. It funded my move to a new state/job and starting over at 0 with my debts. It was like 12k in the account, $5500 to my bank account iirc. I would do it again to not have a dime sitting in a CA account.

 

[rogerdoger]

I did back around 2009. I went out on my own building houses right before the crash. It helped me through that hard time but sure wish I had not taken the money out.

 

[NRA4LIFE]

I'm 62, been retired near 10 years now and have only drawn from it once, but only about 5% of it. We haven't touched my wife's yet. With our SS and wife's pension payments, we're pretty much solvent.

If you had matching by your company, plan very well on how much taxes to take out on withdrawal.

 

[willfrye027]

I did recently, at least a good chunk of it to put a down payment on a house.

I don’t like that it happened..but it was the right move for the family. It will cost me approx 2-3 years in retirement age, maybe more.

If at all possible you should avoid it!

 

[180ls1]

I did back around 2009. I went out on my own building houses right before the crash. It helped me through that hard time but sure wish I had not taken the money out.

Props to you. Not many own up to their mistakes. Most will rationalize their decision even if it was a mistake, myself included, as much as I try not to.