Phooley in Phoenix posted a valid comment that a particular 401-K plan "may not allow the flexibility" to pull irregular sums (so you could avoid 10% income tax penalty). That is probably true, but so many folks don't know that the IRS rules DO allow that way around the 10% penalty, that I wanted to make sure they were aware of it. So many of us rush to roll over our 401-K into an IRA, only to find out later that we might have given up something in process. For example, several of the mutual funds in my former employer's 401-K, because of volume, charge very reduced fees for their service (example: about 1/2 for Vanguard S&P's already low fees). So, if you rolled into an IRA in same type of mutual fund, you would make less net return each year than if you left it in your 401-K.
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