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1/25/2018 7:38:29 AM
Posted: 1/16/2006 8:42:31 AM EST
I had a job that took money out of my check towards a 401k account. It's roughly about 25k. My problem is that I want to use it. Thanks to some poor choices on my part ,i've accummulated some large debt . Made the mistake of putting a exgirlfriend on my credit card, living over my means, etc.


Anyways, the 401k admins wont let me touch the account. I'm thinking of getting a tax attorney and seeing if I could sue to get my money. I know its a retirement fund and all but I dont want to kill my credit. I'd rather wipe that out and not let my credit get anyworse than it is.

Any ideas?


Link Posted: 1/16/2006 8:46:01 AM EST
I would advise you to think long-term.

Pay off your debt as and when you can. Do not use your 401K for that. Eventually, you will have good credit and no debt again. And after that, you will still be able to retire. Every penny you save now is going to grow and be worth much more than paying off some debt while you are still young.

I doubt you will listen, but I tried.

G
Link Posted: 1/16/2006 8:48:33 AM EST
Don't do it. Leave your 401k where it is. Taking it out early is basically stealing from yourself.
Link Posted: 1/16/2006 8:50:32 AM EST
It's YOUR money.


Do what YOU want with it. Talk to the 401k place the money is invested.


You could also just take a loan against it.
Link Posted: 1/16/2006 8:53:13 AM EST

Originally Posted By MACHINE:
I had a job that took money out of my check towards a 401k account. It's roughly about 25k. My problem is that I want to use it. Thanks to some poor choices on my part ,i've accummulated some large debt . Made the mistake of putting a exgirlfriend on my credit card, living over my means, etc.


Anyways, the 401k admins wont let me touch the account. I'm thinking of getting a tax attorney and seeing if I could sue to get my money. I know its a retirement fund and all but I dont want to kill my credit. I'd rather wipe that out and not let my credit get anyworse than it is.

Any ideas?





While I agree its your money, please keep in mind you will most likely suffer an instant 20% penalty for early withdrawn in addition to the negative tax implications of early 401K disbusments. You'll pay substantial tax penalties for it. Like 30% or so depending on factors.
Link Posted: 1/16/2006 8:53:37 AM EST
Link Posted: 1/16/2006 8:53:45 AM EST
[Last Edit: 1/16/2006 9:05:31 AM EST by hanau]
if you no longer work for the company who set up the 401k with,you should beable to get it.

but i would leaeve it alone unles you forsee a long term unemployment or going to loose your house.


If you no longer work for the company who set up the 401k with, you should beable to get it.

But I would leave it alone unless you foresee a long term unemployment orthe bank is going to foreclose on your house.
Link Posted: 1/16/2006 8:57:35 AM EST
Here's something to think about. Your 401k money is pretax. If you withdraw it and repay it later, you will repay it with AFTER tax income. For the hell of it say you are in the 30% tax bracket. To repay it you will have to earn $35,714.28 to refund it. Then, when you withdraw THAT money they will tax you again. Any tax attorneys out there correct me if I'm wrong here. That's how it was explained to me.
Link Posted: 1/16/2006 8:59:07 AM EST
[Last Edit: 1/16/2006 9:03:03 AM EST by pv74]
Definately not worth it...

Do you have assets that you can do without that are easily liquidated?

I hate to say it, but you may consider selling a few guns to pay some of it off...

Maybe a debt consolidation loan?


Link Posted: 1/16/2006 9:00:02 AM EST
Ok, if I leave the 401k alone, how else do I get the creditors off my back then? Im just making the min payment that doesnt do squat to get rid of the debt. I'm actually stressing over this.
Link Posted: 1/16/2006 9:00:47 AM EST
Link Posted: 1/16/2006 9:01:32 AM EST
[Last Edit: 1/16/2006 9:02:17 AM EST by KNYTE]

Originally Posted By MACHINE:
Ok, if I leave the 401k alone, how else do I get the creditors off my back then? Im just making the min payment that doesnt do squat to get rid of the debt. I'm actually stressing over this.



Work more hours or get a better paying job.

edit: or sell some stuff.
Link Posted: 1/16/2006 9:02:14 AM EST

Originally Posted By MACHINE:
Ok, if I leave the 401k alone, how else do I get the creditors off my back then? Im just making the min payment that doesnt do squat to get rid of the debt. I'm actually stressing over this.


Call them, tell them you are having financial issues and why those issues exist. Work out a payment plan.
Link Posted: 1/16/2006 9:04:48 AM EST

Originally Posted By callgood:
Here's something to think about. Your 401k money is pretax. If you withdraw it and repay it later, you will repay it with AFTER tax income. For the hell of it say you are in the 30% tax bracket. To repay it you will have to earn $35,714.28 to refund it. Then, when you withdraw THAT money they will tax you again. Any tax attorneys out there correct me if I'm wrong here. That's how it was explained to me.



worth empasizing. You will lose way too much money on this move. DO NOT USE IT. Talk to a debt consultant instead.
Link Posted: 1/16/2006 9:14:04 AM EST

Originally Posted By fight4yourrights:
You could also just take a loan against it.



You pay yourself back at 8% interest, I believe. Which is a whole heck of a lot better than the 20% you pay on cards. Worth a look see.

Still not ideal, as you do not get the compound growth on the money you withdraw.

G
Link Posted: 1/16/2006 9:23:41 AM EST
[Last Edit: 1/16/2006 9:25:52 AM EST by TimJ]
Link Posted: 1/16/2006 9:49:22 AM EST

Originally Posted By glock23carry:

You pay yourself back at 8% interest, I believe. Which is a whole heck of a lot better than the 20% you pay on cards. Worth a look see.

Still not ideal, as you do not get the compound growth on the money you withdraw.

G



correct me if I'm wrong, I believe when you pay back a 401K loan you're paying with after tax dollars so when you take those $ out again at retirement time you have to pay taxes on it again, not good
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