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401k and Bankrutpcy

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wiguy33
New Visitor

401k and Bankrutpcy

Hello all, this is new as I am also new to the forumn. My question has to do with my 401k.  I just had my meeting of credotors (341) yesterday and have been thinking about what I want to do with my life. Been sick alot (2 surgerys past two years) led me to my filing as I also have student loans and noramls bills like housing and credit cards. Well I have been thinking about if I am going to be staying with my employer (been thinking about it for over a year). Well my 341 meeting was the last straw. My brother had to take me cause my truck decided it needed repair. I have enough in my 401k to purchase a decent (new) vehicle after taxes and penalties. I have been thinking about leaving my employer for something that makes me happy and I am now in need of reliable transportation.

 

My question is: Is it safe for me to quit and take a payout and purchase transportation or do I have to wait for the discharge notice? The trustee mentioned something for 180 days for inheritance and lottery winnings.

Message 1 of 4
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grassfeeder
Frequent Contributor

Re: 401k and Bankrutpcy

I would wait out your discharge, nothing good can come out of wanting to rush things during these times.

 

Also, why would you not just get a small loan to purchase an inexpensive vehicle versus taking a huge tax hit on your 401k and killing that.

 

Think long term.

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Message 2 of 4
kimmiller112
Frequent Contributor

Re: 401k and Bankrutpcy


@wiguy33 wrote:

Hello all, this is new as I am also new to the forumn. My question has to do with my 401k.  I just had my meeting of credotors (341) yesterday and have been thinking about what I want to do with my life. Been sick alot (2 surgerys past two years) led me to my filing as I also have student loans and noramls bills like housing and credit cards. Well I have been thinking about if I am going to be staying with my employer (been thinking about it for over a year). Well my 341 meeting was the last straw. My brother had to take me cause my truck decided it needed repair. I have enough in my 401k to purchase a decent (new) vehicle after taxes and penalties. I have been thinking about leaving my employer for something that makes me happy and I am now in need of reliable transportation.

 

My question is: Is it safe for me to quit and take a payout and purchase transportation or do I have to wait for the discharge notice? The trustee mentioned something for 180 days for inheritance and lottery winnings.


  To be on the safe side, I would wait it out.  While the money is in the 401K, it is safe, but it is not safe when it is out.

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Message 3 of 4
Dustink
Valued Contributor

Re: 401k and Bankrutpcy


@grassfeeder wrote:

I would wait out your discharge, nothing good can come out of wanting to rush things during these times.

 

Also, why would you not just get a small loan to purchase an inexpensive vehicle versus taking a huge tax hit on your 401k and killing that.

 

Think long term.


+1

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