Deep down you know this money should stay put. Money
in a retirement plan is income-tax-deferred. So, it has the
potential to continue compounding and growing. Look how much
$2,800 today could be in 35 years.
So, what's more important? Instant gratification, or a chance for financial peace of mind…today and tomorrow?
For illustration only and does not reflect an actual investment. Assumes 5% expected rate of return over 35 years,25% tax bracket, $40,000 annual income, and no additional contributions.
Got an outstanding loan on your account? Cash out and you'll need to repay it on the spot. Otherwise, you'll owe income tax (at your regular rate) plus a 10-percent penalty.