How to cash out 401k plan before and after retirement?

401k is a type of financial contribution that enables you to save early in your career.  Learn here how to cash out 401k and what are its pros and cons.

Eligibility criteria for 401k cash out

Certain eligibility criteria exist that you must meet to cash out the most lucrative investment of your lifetime. Check the next slide to learn more about it.

Still Employed

If you are still working for the employer sponsoring your 401k plan, you can’t cash out your 401k plan. However, you can check if you are eligible for a 401k loan or hardship withdrawals.

No longer employed

You can access your retirement savings if you no longer work for the employer sponsoring your 401k plan. You can rollover your funds into an IRA to avoid taxable transactions.

Steps to cash out your 401k before retirement

The process of withdrawing funds from your 401k plan depends on both, your employer as well as the methods you choose for withdrawing.

Step 1

Check via HR if your company allows for early withdrawal of 401k. If so, check the withdrawal options available to you in the plan documents and which ones you’re eligible for.

Step 2

Contact your plan provider to request to send you all the information and paperwork required to cash out your retirement funds. 

Step 3

Get necessary signatures from HR or plan administrators at your firm or former firm to affirm that you have completed the necessary paperwork and are authorized to execute the cash out option.