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My wife called Life of the Southwest and was asking to withdraw funds and she was told that she could not withdraw her money. Is this correct?
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My wife called Life of the Southwest and was asking to withdraw funds and she was told that she could not withdraw her money. Is this correct?
What if she was leaving the employer?
A 403b has restrictions other than just what the product used has. One being that you must be 59.5 to access it. This is a government regulation.
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She could transfer to a new product but all the gov regs stay the same.
The contract has the normal withdrawal definition. Where is shows the decreasing withdrawal penalty and the statement that if she does make a withdrawal prior to age 59.5 then it will be subject to an additional 10% on top of her current tax rate. Not on any signed document does it say she can not withdraw funds until age 59.5.
What if she was leaving the employer?
If she was retiring, she could access the funds penalty free (still subject to income taxes) at age 55. There are a number of other ways to gain access prior to 59 1/2 w/o penalty as well (death, disability, SEPP etc.)...
As Norwayguy points out, she could also roll to an IRA.
Dang it I forgot to mention disability. SEPP (Substantially equal periodic payments) could only be done with seperation or attained age of 59 1/2...I know I tried 72t distributions on employed participants.