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i had a long story written out, but the point is i have a very ... Stackers' Lounge forum

  1. #1
    offthahorseceo's Avatar
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    who knows something about 401k's

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    i had a long story written out, but the point is

    i have a very small amount of money ($132.14) in a 401k. i no longer work for that company. 88.01 of that is vested.

    what are my options here? can i keep funding it out of pocket? can i cash out?

    i dont really understand 401k's but from what it looks like im investing in something like "BlackRock Money Market" or "American Balanced Fund".Is it at all possible to add these to my etrade account?

    I kno its only $88-$132 but thats money. id rather not let it go to waste

  2. #2
    nny2k's Avatar
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    If you are no longer with that company you can cash out or roll over the vested portion to a new 401k or something like e-trade.

    I'd get in touch with the HR department of your old company and they can give you more particulars, but it should be a fairly simple couple of forms.

    Best of Luck!

  3. #3
    offthahorseceo's Avatar
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    i just got off the phone with PNC (the 401k company) she said basically since its "such a small amount" my best bet is to cash out...

    geez, i didnt even find out until near "the end" that i had a freakin 401k, and when i did i had questions and noone could answer them. everyone was like "ionno" i think only me and one other person had a 401k with the company at the time

  4. #4
    tjguzik's Avatar
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    If you cash it out you will pay penalties and tax on the amount withdrawn. You will end up with more like $60.

  5. #5
    tjguzik's Avatar
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    there is a 10% tax on an early distribution if you are not 59 1/2 years old. You may also be taxed on any earnings that the investment made. You will get a 1099-R for 2008 income taxes for this transaction.

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    offthahorseceo's Avatar
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    so is she right though? do i have other options? even if its letting it sit where it is and "diversifying". right now its actually all in one "fund" which is supposed to be stable growth but actually lost me 3 dollars in the last quarter. id like to get some of the money into a higher risk/return fund.

  7. #7
    tjguzik's Avatar
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    Well, you CAN cash it out, but you have to pay the tax. If you do not want to pay the tax, you can roll it over (within 90 days) to an IRA with any broker you choose. If you do this, you can pick any investment you wish.

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    sherman76's Avatar
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    Actually, you only have 60 days to roll it into a IRA or new 401k at your current employer

  9. #9
    tjguzik's Avatar
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    you are correct Sherman, i stand corrected, thanks.

  10. #10
    TNgal22's Avatar
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    I had an OLD 401K account from a previous employer (back in 2002), when I was able to get 401K with my current job (Jan 07), I had to cash it out due to my last name being differen. And yes, there is a penalty and you will have to report it on your next year income tax form. However, with my job before this one, I just filled out some paperwork and had that one rolled over into the new 401K account.
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