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2022-10-22 - 9:34 a.m.

I never understood why anyone would want to roll over a traditional 401K into an IRA

Now I do"

"Impact on Unemployment Benefits
IRA withdrawals do not reduce your unemployment benefits. In contrast, the portion of a 401(k) distribution ascribed to employer contributions does reduce the unemployment benefits you receive.

If you lose your job, you have the right to roll your 401(k) to a traditional IRA tax-free. You can then withdraw money from your IRA without reducing your unemployment benefits."

WHEW I am happy that the disbursement I took was from my IRA. I DID NOT roll over the 401K from the last employer! OOPS had I done so that would have been another source of income I could pull from which would not affect unemployment benefits.

What bothers me most is that if the system were EFFICIENT
folks would receive unemployment insurance payments and be able to pay their mortgages and health insurance premiums WITHOUT touching their retirement funds. Folks only touch retirement funds WHEN NO OTHER CHOICE.

It happened that I pulled from the IRA rather than the 401K funded by employer simply as my IRA is the only account that I had set up with stock trading and which I had ADDED my own money to and which was easy to get cash liquidity from.

I added my BONUS of $4000 at the end of last year to my IRA and bought some stock as thought "Why not"? Since I was in solid financial shape.
So I pulled from the RIGHT account, which will not affect my unemployment ACCIDENTALLY.

My stocks ( like most!) plummeted as the market was hit this year. That IRA lost value. (Alot!)
But I still had ease of creating liquidity quickly so that is where I pulled money from in order to pay my bills.

AH--- I pulled in order to pay my INSURANCE PREMIUMS...

*HA HA... of course...
(half dozen one six of other right? I mean I had to pay MORTGAGE and INSURANCE Premiums these months... what money went to which no matter...)

Even though technically I was concerned FIRST about mortgage payment. ROOF overhead greater priority than insurance premium or doctors.

I mean for HEALTH First and foremost
GET SLEEP in a safe secure home.

Then the rest gets better I think.

(or at least not worse)

Law is also that at the end of the year I guess if pulled from IRA to pay health insurance premiums that amt is not taxed the extra tax.

If the amt of premiums is LESS than the amt pulled in they year then good and get a waiver from the penalty of pulling out before actual retirement.

SO I should be good on that point as well.

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