How to Withdraw Money
For many Fidelity workplace retirement accounts, we can begin by signing in to Fidelity NetBenefits and reviewing the 401k plan's available withdrawal options. The exact screens and choices can vary by employer plan.A typical process is:
Sign in to the Fidelity workplace retirement account.
Open the applicable 401k account.
Review the available withdrawal, rollover, or loan options.
Select the appropriate transaction if the plan makes it available online.
Review the distribution amount and applicable tax information.
Choose the payment method offered by the plan.
Review the transaction carefully before submitting the request.
Save the confirmation and related tax documents.
The important point is that Fidelity does not establish one universal withdrawal rule for every 401k. The employer's plan document controls the options available to participants. If an online withdrawal option does not appear, the plan may not permit that transaction under the current circumstances.
How to Withdraw Money
After leaving an employer, we generally have several choices for money held in a former employer's 401k. Fidelity identifies four common options: leave the money in the former employer's plan if permitted, roll it into an IRA, roll it into a new employer's retirement plan, or take cash distribution.If we specifically want to , we first need to determine whether the former employer's plan permits a distribution following separation from service. Once eligible, the account may provide an online distribution request through Fidelity NetBenefits.
Before taking the entire balance in cash, we should consider the tax consequences. A taxable distribution generally becomes part of taxable income, and an early distribution may also be subject to the additional 10% tax unless an exception applies.
Leaving a job does not automatically mean that cashing out the entire 401k is required. A rollover may allow retirement assets to remain within a tax-advantaged retirement arrangement.