Just a few quick notes: If you can withdraw your 401k without penalty at 55, that may (or may not) be a better deal rolling it over into a 'Rollover IRA' where you will have to hold it till 59-1/2 unless you take advantage of some pretty inflexable early withdrawal plans (72t rules, I think). Sorry to say, that when (and if) you do withdraw from your rollover IRA you will still be taxed on your withdrawals as income not capital gain. The stock portion of your 401k is a different animal altogether and might be eligible for paying just capital gains taxes if you do it right. How regular people figure all this out is beyond me. I doubt, too, the financial advice professionals get it right every time. I'm going through the same thing with my 401k (to roll or not to roll is the question)and I am going to have to spend some serious time with a spreadsheet before I am comfortable with my answer. Good luck, -- JohnRJW wrote:Okay...i'm confused about all of this. I have a 401K with mutual funds and company stock bought with the company match. Sounds like when I retire at 55 I could leave my 401K intack and draw money from it without paying a 10% penalty. I checked and it's okay with them. It also sounds like I would be better off if I roll the 401K into an IRA and take advantage of getting a cost basis for the stock and pay tax on the capital gains rather than paying tax on the money withdrawn as normal income. I have worked there for 30 years so the cost basis is probably going to be low. It also sounds like if all this is not done just right I could end up paying the 10% penalty. To be sure this is all done correctly and in a way that will be financially to my advantage I would feel a lot better having a professional do it. I would like to have control over my money and not relay on a financial advisor. Who do I have set this up so I know it's done right.
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