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Hardship withdrawals from 401k

Discussion in 'I'm Lost!' started by targetflowslave, May 16, 2017.

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  1. targetflowslave

    targetflowslave Team Member

    has anyone done this it seems so complicated help please!!!
     
  2. Hardlinesmaster

    Hardlinesmaster Business Partner

    Go on ehr or targetpayandbenefits.com for starters. Be ready for a 34% tax hit.
     
  3. Shirohime

    Shirohime Team Member

    Why not borrow from it? There's interest but you won't be taxed for an early withdrawal, or so I was told.
     
    Rarejem likes this.
  4. Hardlinesmaster

    Hardlinesmaster Business Partner

    Go under targetpayandbeneifits, hit 401k option. It will have directions to follow on how take it out.
    Note: You will be charged $20 per NonHardship Withdrawal. Your after-tax contributions will be suspended for six months. You will need to re-elect your after-tax contribution rate after your suspension has ended. You are still allowed to contribute on a before-tax basis as long as you are not also currently suspended for taking a hardship withdrawal from the plan. You may elect or change your before-tax contribution rate at any time.
     
    Last edited: May 17, 2017
  5. Rarejem

    Rarejem Team Leader

    Over the years I have had to borrow from my 401k a few times. There's a fee upfront, but it's not much, the interest isn't high, repayment is automatic from your paycheck. I actually did this to do some house upgrades as the interest is less than a credit card and it would not affect my credit rating, etc. like a home equity loan would. There are no penalties and it is not taxable.
     
    Hardlinesmaster likes this.
  6. OP
    OP
    targetflowslave

    targetflowslave Team Member

    I would but already have a loan out and my car is in danger of being repossessed
     
  7. Cooliobum

    Cooliobum GSA

    how much is needed? maybe you can cash out sick or vacation hours...might be the better choice if possible
     
  8. YourPPTL

    YourPPTL Team Member

    If you take a hardship withdraw you will get taxed heavily. Take out a 401k loan, its the best option. Cost 75$ they deduct the payment from your check. It goes back into your 401k.. No tax you payback yourself..
     
    Apapaia likes this.
  9. tgtfla

    tgtfla Team Trainer

    All good advice,but if you already have a loan it doesn't help.Target does have a hardship fund that help tms in distress,ask your hr about it,it may help you get through this,withdrawing from the 401k as said above is very heavily taxed,full rate +10%
     
  10. quillshot

    quillshot Hardlines Team Lead

    Repayment comes from your check? Say I took 1k out, would I expect 1k to be taken from my check in a lump sum? I had been thinking about doing this to cover some emergency medical bills, but still need my paycheck to make rent and fit my budget.
     
  11. OP
    OP
    targetflowslave

    targetflowslave Team Member

    How much would they give me?
     
  12. tgtfla

    tgtfla Team Trainer

    not sure if it's still in existance,but I know tms who got up to $500
     
  13. Hardlinesmaster

    Hardlinesmaster Business Partner

    Hardship fund is gone.
     
    HRZone and tgtfla like this.
  14. redeye58

    redeye58 Hasta Ba Rista, Baby!

    Doesn't surprise me :(
     
    tgtfla likes this.
  15. tgtfla

    tgtfla Team Trainer

    that is a great pity,I know a lot of people that it helped over the short term,but it was no solution for short hours or low pay or even a lack of ability or desire to make progress.
     
    Hardlinesmaster and redeye58 like this.
  16. Rarejem

    Rarejem Team Leader

    No, you are basically borrowing from yourself. You choose how long you want to take to pay it back (I think it's either 3 years or 5 years although you can choose to pay it back all at once). They'll take it out in increments for that amount of time. You can't pay back chunks at a time... it's either the installments they've set up or one lump sum. (For example: you get a large tax return and want to pay off a large part of the loan... can't do it.)
     
    Logo, Hardlinesmaster and redeye58 like this.
  17. SrTLall

    SrTLall Team Trainer

    You can also elect pay off the remaining amount at any time.

    I believe one of the only stipulations for a 401k loan is that you are restricted to taking out only a % of your total 401k, something like 50%.

    The repayment period is 12-36 months.
     
    Last edited: May 20, 2017
    Logo and Hardlinesmaster like this.
  18. glo

    glo Food TL

    I wanted to bring this up but I'm not sure if you would qualify with money in your 401k...

    Target offers a good will financial hardship program where they can cut you a check of up to $500 I think. One of the HR people here may know a little bit more about it.
     
  19. Hardlinesmaster

    Hardlinesmaster Business Partner

    That hardship fund was stopped by spot, last year.
     
    HRZone likes this.
  20. glo

    glo Food TL

    RIP