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Old 04-16-2013, 10:58 PM   #21
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Katsmeow's Avatar
Join Date: Jul 2009
Posts: 3,131
Well, some plans have rules about how you can withdraw.

For example, in my plan, you are allowed to withdraw at 55 if you leave if you had at least 10 years of service.

That is basically that, yes, I could withdraw from the plan at or after 55 but before 59 1/2 (since I have more than 10 years of service).

That is a completely different question from how I can withdraw. Regardless of my age, even if I was 65 for example, I can withdraw in only 2 ways. I can withdraw all the money in a lump sum. Or, I can withdraw in substantially equal amounts over a period of time, such as annual or more frequent installments. I could do the substantially equal amounts and then after a while decide to fully withdraw the remaining balance.

However, I could not, for example, decide to withdraw $30,000 a year for 3 years and then stop withdrawing. Or, withdraw $50,000 this year and $20,000 next year and then $40,000 the following year.

(Note that sometimes in-service withdrawals of a lump sum specified by the employee can also sometimes be made depending upon age and the terms of the plan.)

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