My Strategy,... will it work??

[pb4uski]

I suspect that what may be happening here is that the individual's particular plan doesn't allow people to keep money in the 401(k) after leaving and doesn't allow post-employment 401(k) withdrawals. I don't know all the details but people are not necessarily allowed to stay in a 401(k) plan after leaving employment. When DH retired he was allowed to keep money in the 401(k) plan but when he wanted to withdraw something he had only 2 options (1) roll over the entire plan to an IRA or (2) start periodic withdrawals which would result in withdrawing everything in the plan through equal withdrawals (he was over 59 1/2 so that age 55 exception didn't come into it).

Interesting. I suspect you are right that it has something to do with OP's specific plan. In a perfect world, 401k withdrawal options should be the same for all plans, but....

 

[RetireBy90]

While I would agree with the many comments about the variable annuity (just say no) and finding a way to save the 10% penality, I would comment on the $23K for 4 years. I am putting my first 5 years of draws into a ladder of 5 year CDs. There are better returns I know but it provides a safe guarenteed lump of $ each year while I learn to live in retirement. Being a vet you can join Pentagon Federal Credit Union and get 1.9% on 5 year CD today. Not greate but seems better than many others like a bank - Wells is offering 1.18% today.