What happens 401k if you quit. How does that work?
What if I have a loan I used to purchase my home?
Thanks.
Cheers!
10 replies (most recent on top)
What kind of moron comes here asking serious questions like this?
OP : take some real advice, dont trust the mucho BS appearing here. Research below item :
"IRA is a safe choice because of two reasons"
Maybe. But there is a catch. By rolling into an IRA, assuming you have more than a few pennies, you'll effectively inhibit the so called 'backdoor ROTH IRA' - if that is of any concern to you......go research.
You'll have 90 days to pay off the 401k loan or there is 10% penalty.
The money in 401k is your money, and you will have access to it even after you leave. You can continue to keep it 1)as-is, or 2)you could roll it to the 401k of your new company (the rollover process is simple), or 3) you could roll it into an IRA.
IRA is a safe choice because of two reasons - no annual fees in most cases and variety of investment options within IRA,...In addition, you will be protected from Q's 401k rule changes in case they happen.
If your balance is greater than $5,000, you may: leave your account in the Plan; or rollover your account into a qualified IRA; or - rollover your account into a new employer’s plan; or take a distribution of your entire account balance (federal income taxes will be withheld and the distribution may be subject to additional taxes and applicable early withdrawal penalties).
If your balance is between $1,000 and $5,000, your account will automatically be transferred to a Fidelity IRA account unless you request a distribution or rollover prior to Fidelity’s quarterly processing schedule. If your balance is less than $1,000, your account will automatically be distributed, payable to you unless you request a distribution or rollover. You will be notified of the forced payout well in advance in order to give you the opportunity to direct your payment accordingly.
If you have a 401(k) loan against your Fidelity account, you may: Pay the balance of the loan directly to Fidelity; or -Continue to make loan payments directly to Fidelity To continue to make loan payments, Fidelity will forward a coupon book to your home. If you do not pay off your loan balance or continue timely loan payments directly to Fidelity, your outstanding loan balance will automatically default and will be subject to federal and state taxes as well as potential penalties. It is your responsibility to keep your loan payments current.
Cutting through the BS.
The the original poster, the loan become due immediately. This is one of the big big downsides of lending your 401k funds to yourself. Go call Fidelity, they are very helpful and well informed.
You picked the right site to ask questions like this!
It's gone, boom, Q takes it all and puts it into the new G550 fund.
The 401 K is yours to keep.. you can move it to a brokerage and make it into a IRA and manage yourself, or leave it in fidelity.. once you make it into a IRA though, you cannot (correction) convert it back into a 401K.
If you want options, let's talk. Post your email address and I'll provide details.
The 401 K is yours to keep.. you can move it to a brokerage and make it into a IRA and manage yourself, or leave it in fidelity.. once you make it into a IRA though, you can convert it back to a 401K.
You loose it all, company keeps it. If you have a loan for a house, it's now the company's house.