Watching the videos on severance and benefits brings up decisions to make. What’s the pros and cons on:
Any other decisions to consider?
I-c-u-8-1-2 !
Don’t touch 401k until you understand when and how you manage company stock "NUA" (Net Unrealized Appreciation).
You will pay taxes on the lump sum withdrawl or rolling your 401k to a Roth
@a3, Nothing that I worked my butt off for was "free" but maybe you are special and got things "free".
@aw+1jngff3hh A 401(k) provides more legal protections—bankruptcy protection, legal liability protection, and federal law protection (ERISA—against local laws). Do some research or check with a tax attorney or financial advisor to make the best decision for yourself.
Lump sum and roll over! Do you really want to keep your money where “they” control the choices?
How you want to invest and where are your choices including tax deferred or no.
But avoid having to ask Dad for a quarter.
You asked about rolling the 401k into a Roth IRA. Don't do that! You roll it into a rollover IRA - which is not a taxable event. Then you can convert slowly into a Roth if you want to in measured amounts to keep the taxes on the conversion low. Don't ever keep a 401k in place though; always roll to a rollover IRA where you control the investments more.
Do ALL the math. You are getting Salary, Pension Contributions, 401k Match, and Health Care contribution. Make sure you include all the financial contributions against the Severance.
Take the lump sum and withdraw when you’re severed. Invest in your choice to get a higher rate. Same with 401k.
Spend your fcsa on contacts or dental work because $500 was free