Thread regarding Wells Fargo & Co. layoffs

To those 55+ laid off and have 401k

Ask about Rule of 55. Empower customer support can help.

In simple terms, if you are 55 years or older and unemployed, by choice or otherwise, you can take funds from your 401k. There is no penalty. Taxes will be whatever state and federal you would have to pay anyway.

If you have Roth funds in your account, those funds can be taken with no penalty and no taxes since Roth is post-tax.

If you have both 401k and Roth, your withdrawal will be in the same split/% as those two accounts already exist in your fund. So, say you have 401k making-up 64% of your account balance, and Roth makes up the remaining 36%, your withdrawal will be 64/36 as well.

by Anonymous
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Post ID: @OP+1jry0nvqr
Comment! It's anonymous!

7 replies (most recent on top)

@ag+1jry0nvqr

The key is to have enough to do both.

by Anonymous
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Post ID: @ck+1jry0nvqr

@ap+1jry0nvqr

DO NOT do this if you want to take advantage of Rule of 55.

In order to take part in Rule of 55, the funds MUST COME FROM YOUR EXISTING 401K! You cannot move the funds to a new IRA etc., and then pull funds from that new account.

I moved a chunk of my WF 401k to a new Empower IRA. If you have at least $250k or something, you get free financial advice.
I left a chunk of my WF 401k IN the WF 401k while I decide what I want to do with it.

by Anonymous
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Post ID: @cj+1jry0nvqr

So I could withdraw the entire $1,243.13 I have save for retirement? Wow!

by Anonymous
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Post ID: @c3+1jry0nvqr

Create a traditional or Roth IRA at Schwab or Fidelity. Roll all your Empower BS into it (trustee to trustee transfer). Since your layoff is a qualifying event you can do this. AI Prompt "Just laid off How do I set up an IRA and roll my 401K at Empower into it". Its amazing how much financial advice you can get from AI!

by Anonymous
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Post ID: @ap+1jry0nvqr

Or, use your emergency fund, get another job, and let your retirement grow

by Anonymous
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Post ID: @ag+1jry0nvqr

It's a little more complicated than that, you need to have left your job (voluntarily or involuntarily) at 55yo or later and you can only dip into the 401k from that latest employer (which must still remain with that employer). Definitely can be nice way to bridge the gap until 59.5yo though.

by Anonymous
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Post ID: @ae+1jry0nvqr

For under 55, there's SEPP rule for 72t if you've got the funds.

by Anonymous
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Post ID: @a6+1jry0nvqr

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