Retiring at 62 with $400,000 in a 401(k) is possible, but requires careful planning and conservative spending. Assuming a 4% annual withdrawal rate, you could withdraw $16,000 per year, which may or may not be enough to cover your living expenses. To increase your chances of success, consider delaying retirement, maximizing additional income sources, and … Read more
Your Fidelity 401(k) investments are insured by the Pension Benefit Guaranty Corporation (PBGC), a U.S. government agency. This insurance protects your retirement savings up to certain limits, ensuring that you won’t lose everything if your employer goes bankrupt. The PBGC insures most defined-benefit pension plans, which guarantee a specific retirement benefit at a certain age, … Read more
Elective deferral 401k is a retirement savings plan offered by employers where you can choose to contribute a portion of your paycheck before taxes are taken out. This contribution is called a deferral because it’s taken out of your paycheck before you ever see it. The money you contribute grows tax-free until you retire and … Read more
An employer can deny a 401k loan request if they have reason to believe that the employee is not able to repay the loan, or if the loan would put the employee’s retirement savings at risk. Employers may consider factors such as the employee’s income, debt-to-income ratio, and investment goals when making a decision. Employers … Read more
In the United States, both spouses can contribute to their respective 401(k) retirement accounts. Each spouse can contribute up to the annual limit set by the Internal Revenue Service (IRS). This allows couples to maximize their tax-deferred savings. However, it’s important to note that the contribution limits are per person, not per household. So, even … Read more
Vesting refers to the process where you gradually gain ownership of your employer’s contributions to your 401k plan. It’s expressed as a percentage, and it typically starts at 0% when you first start working and increases over time. For example, you may become 20% vested after one year of service, meaning you own 20% of … Read more
If you lose a loved one who had a 401(k) retirement account, you may be wondering if you can inherit it. The answer is yes, but the process can vary depending on the type of 401(k) account and the beneficiary designations. Generally, there are two ways to inherit a 401(k): as a spouse or as … Read more
Transferring funds from a 401k to a 403b is generally possible and can offer certain advantages. 403b plans are retirement savings plans specifically designed for employees of public schools and certain other tax-exempt organizations. Unlike 401k plans, which are primarily offered by private sector employers, 403b plans provide similar tax benefits but may have different … Read more
To withdraw from your Empower 401k, you can either call their customer service line or follow the steps for an online withdrawal. To withdraw online, log in to your Empower account, navigate to the Withdrawals tab, select the type of withdrawal you want to make, enter the amount you want to withdraw, and choose how … Read more
When considering Medicaid eligibility, understanding if assets are exempt is crucial. A 401(k) is a retirement savings plan that offers tax advantages. In most cases, 401(k) plans are considered exempt assets under Medicaid. This means they are not counted when determining eligibility for Medicaid benefits. The funds held in a 401(k) account are protected from … Read more