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Angie_m

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A very good friend of mine needed a large sum of money due to a divorce. He left her everything so was not able to liquidate "his" assets. He needed the money to provide a new home for his two sons. He explained this to the director of human resources who explained he would have to resign (wink) to obtain the distribution. He was told in a roundabout way that he would be able to get his job back which he's had for many years. Its a City job. Weeks after the distribution he's still unemployed. I feel he was not given all his options during the two weeks of discussions and he was basically conned into losing his position. What are his rights? What exactly were his other options to begin with? Any advice would greatly be appreciated.

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What a mess! Giving up ones life savings to buy his children a new home is a financial mistake but taking the risk of losing your job to do this is terrible judgement. The union should be able to give him his rights about getting his job back.

At least he has you for a friend cause he needs one right now.

God bless,

Steve

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What a mess! Giving up ones life savings to buy his children a new home is a financial mistake but taking the risk of losing your job to do this is terrible judgement. The union should be able to give him his rights about getting his job back.

At least he has you for a friend cause he needs one right now.

God bless,

Steve

 

 

Thank you for the kind words. No he did not BUY a home as that would be crazy like quitting his job. HA - anyway...it doesnt seem like it was fair for a city employee of many years to be given so few options to get his money...basically die, have his wife die, or quit his job. Im looking for answers here. Like something to bring to the HR guy to say "Hey...this is an option he was not given when you suggested he quit his job." (Of course I wont be talking to Mr. HR..he can handle his own affairs if he had some sort of direction!) Where else can I look that will give me the breakdown of this type of plan? Thanks again.

 

A

 

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Hi Angie,

Since you posted in the 457 forum, I am assuming you are asking about options in his 457 plan. He should ask for the plan document from the HR department that would have his options. Unfortunately, there may not be any simple answers that we can help you with here. Right now he needs direction about due process from his bargaining unit and if he does not have one, he may have to consult an attorney.

 

If you are talking about a 403b, here are the withdrawal options:

Generally, penalty-free distribution from a 403(b) cannot occur until the participant:

 

1. Reaches age 59 1/2

 

2. Separates from service in the year turning 55 (and must be retired)

 

3. Retire before age 55 — eligible for Substantially Equal Periodic Payments (SEPP). Participants who have retired early (before age 55), but want access to their 403(b) without penalty can do so using SEPP. This provision requires that you take a series of substantially equal periodic payments. The key is that once you start these payments they must continue for five years or until you reach 59 1/2, whichever takes longer. If you start at age 58 you must continue until you are 63 (minimum 5 years).

 

4. Becomes disabled (as defined in section 72(m)(7) of the Internal Revenue Code)

 

5. Through a loan (some investment companies allow this, some do not)

 

6. Dies

 

Good luck,

Steve

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