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<blockquote data-quote="mountaingoat" data-source="post: 255641" data-attributes="member: 1250"><p>You put the money into 401K because it's a tax-deferred strategy. You did not pay taxes on it now, because you will pay the tax man later. It reduces your take-home pay (so you pay <em>less</em> taxes now, and it allows your money to grow tax-deferred.</p><p></p><p>In certain cases of hardship, you are allowed to withdrawal your money, but then you face the tax bill for all the money at the end of the year, <em>plus</em> a 10% early withdrawal penalty.</p><p></p><p>I don't know all the details of your personal situation, but I would suggest that if you need money, cut back your 401K to 0%, and use that. If you need money in the short-term, work extra hours.</p></blockquote><p></p>
[QUOTE="mountaingoat, post: 255641, member: 1250"] You put the money into 401K because it's a tax-deferred strategy. You did not pay taxes on it now, because you will pay the tax man later. It reduces your take-home pay (so you pay [I]less[/I] taxes now, and it allows your money to grow tax-deferred. In certain cases of hardship, you are allowed to withdrawal your money, but then you face the tax bill for all the money at the end of the year, [I]plus[/I] a 10% early withdrawal penalty. I don't know all the details of your personal situation, but I would suggest that if you need money, cut back your 401K to 0%, and use that. If you need money in the short-term, work extra hours. [/QUOTE]
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