does anyone know just how much of a penalty there is for

[Mackay]

Big Daddy , I wouldn't put my money in Tbills. I do think they are going to crash as soon as China and Saudi Arabia stop buying them and I think Arabia already has. They are becoming worthless.
Look into it further.

Both my husband and I have 401Ks. We did not loose money but we also had it in the most conservative funds we could fine. I did loose a little but have more than made it up this year. Finding the most consevative fund is the trick and you should get advice on that. We also have put chunks of money in short term CDS. Its kinda a pain in the but to take care of them, moving them around and all but they have made 4 and 5 percent and they were FDIC insured, if that is worth anything. Other people we knew lost their shirts due to agressive investing.

 

[Big Daddy]

As sylvie said, "I'd seek out some better advice than a SS forum, like an accountant or lawyer before moving on that."

That being said, the 10% penalty can be avoided under certain circumstances, such as disability retirement. Had I known about it at the time, and waited an additional eight days before closing my retirement account, I would have not have had to pay the penalty. So definitely seek professional advice before doing so.

Wow 8 days that sucks.

 

[Big Daddy]

Big Daddy , I wouldn't put my money in Tbills. I do think they are going to crash as soon as China and Saudi Arabia stop buying them and I think Arabia already has. They are becoming worthless.
Look into it further.

Both my husband and I have 401Ks. We did not loose money but we also had it in the most conservative funds we could fine. I did loose a little but have more than made it up this year. Finding the most consevative fund is the trick and you should get advice on that. We also have put chunks of money in short term CDS. Its kinda a pain in the but to take care of them, moving them around and all but they have made 4 and 5 percent and they were FDIC insured, if that is worth anything. Other people we knew lost their shirts due to agressive investing.

I know quite a few people that lost a ton in their 401k's by having them in the more aggressive funds. My mother lost a bunch and I even warned her what was coming. She talked to her investment person and they told her she was just fine. Problem is she is 73 and doesn't have the time it will take to recoup the losses. Like Nifty said it's not really a loss till you pull the funds out.

When I moved my money to t-bills there were no other conservative funds available. They have restructured our 401k plan since then. Right now I am only putting in as much as I need to get the maximum matching funds. I'm putting the rest in 1 year CD's like you said. They are getting 4 to 5%. I think the market is going to go back down to 7000 or so in the next year. I don't think we're out of the woods yet. What's happening now is a result of the stimulus. People need to start spending before we get out of the woods and companies start hiring again. So far everybody is holding their dollars if they got them. The rest are scrambling to stay alive. I will switch my 401k soon. I've just been so busy and I keep forgetting to hit the web site.

Thank you for the advice.

 

[inchworm]

How much longer do you have on your mortgage? Chances are you'll have it paid off before retirment anyway. So leave your retirement $ in place.

 

[old fashioned]

Not that I have the expertise, but just expressing what I'd think....I would compare the interest earned on that fund vs interest paid on mortgage. These may be approx same/similar rates, but then compare which will last longer...the bank holding your retirement fund or the remaining years of your mortgage. Also figure in your age, health, and approx years of receiving that retirement vs years left on the mortgage-which one will you be able to enjoy the longest? In reality either choice is a gamble, you just have to figure what your odds are in either scenerio.