(3) Probably should put this first because I think IT'S VERY IMPORTANT. Please consider the tax remifications. The lump sum withdrawal I got back in 1998 did quite a bit to my tax bill, and all of it happened as I expected:
--- It moved me into a higher tax bracket. IIRC I went from 15% to 27%.
--- It was also considered an "early withdrawal" and subject to a 10% tax surcharge.
--- Only 20% federal taxes were taken out.
Net result? Every $10,000 withdrawn became $8,000 in my pocket (the 20% taken out immediately) and I had to plan on another $1,700 to be banked for the inevitable tax return (27%+10%-20%=17%). So yeah, each $10,000 was really worth $6,300.
YMMV. But I'm guessing it will negatively, because most of my numbers, especially that pesky 10% penalty are pretty hard to evade.
Tax Topics - Topic 558 Tax on Early Distributions from Retirement Plans
Again, I apologize for not properly introducing myself to this forum yet. But I felt I might have something of value to contribute to this thread.