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Distributions from Your 401(k) at Retirement


Lump-Sum Distribution

A lump-sum distribution is just what it sounds like—you take a distribution of all the money in your 401(k) plan in one lump sum. You will qualify to take a lump-sum distribution if you meet the following requirements:

  • The distribution is payable on account of death, attainment of age 59½, or separation from service.
  • Your entire plan balance is paid out.
  • The distribution is made all in one taxable year of the recipient.

You will have two choices if you go this route.

  1. You can roll over all or part of it into a traditional IRA or other retirement plan and defer paying income tax; or
  2. You can pay income tax on the money you keep.



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Investments and Insurance products:

NOT FDIC INSURED NOT BANK GUARANTEED MAY LOSE VALUE
NOT A BANK DEPOSIT NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY


Securities and advisory services are offered through Santander Investment Services, a division of Santander Securities LLC. Santander Securities LLC is a registered broker/dealer, Member FINRA and SIPC and a registered investment advisor. Insurance is offered through Santander Securities LLC or its affiliates.