Adventures in Mamboland
"Jazz Fish, a saxophone playing wanderer, finds himself in Mamboland at a critical phase in his life." --Howie Green, on his book Jazz Fish Zen
Yeah. That sounds about right.
Yeah. That sounds about right.
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Date: 2014-04-02 02:43 pm (UTC)I have a little recent experience in this. It's not as easy as you think.
You can't just withdraw the money without taking a tax hit and a punitive 20% fee for early withdrawal. This is harsh and will likely make you think withdrawing it isn't worth it, which is the point.
You are allowed to make a loan to yourself from it for various reasons, and buying a house is one (if it's a primary residence, etc etc). But there are some catches:
- Your 401k provider has to support making loans, which costs your employer more when they set up the plan. Mine doesn't.
- You can loan yourself a maximum of half the amount, with a special case that you can always loan yourself 10k even if that's more than half.
- And the big one: if you leave your job, your employer can (and probably will) require you to pay back the loan immediately, in full. This includes if they lay you off or fire you.
I decided it wasn't worth the risk / fees.