Most early withdrawals from your 401(k) are for the wrong reason and come with a hefty price-tag. Our Chief revenue officer Mike Wilbert explains why in this articled published on Insurance news Net.
All of the effort employees make to sock away money for retirement is erased when they make early withdrawals from their accounts. Usually, withdrawals made before age 59½ come with a 10% penalty. Some early distributions (hardships, higher education expenses and buying a first home) qualify for a waiver of that penalty, but the withdrawal nevertheless is taxed.