You could consider rolling over part of it into a ROTH SDIRA this will allow you to pay some tax on the money and move it into an account that you will no longer be paying any tax on.I strongly suggest in most cases the loan from the 401k.Your 401(k) is intended to be used to provide for your golden years.However, you might not want to wait until then to cash out your 401(k). You could also roll the 401k into a SDIRA to avoid the tax implications and invest through there. If you are still working for the employer then you can borrow the money and essentially pay yourself back with interest . If you cash out and are under 59 1/2 you will be hit with ordinary income tax and a 10% penalty , IMO too big a price to pay even if you are not in a high tax bracket.More restrictions there which may limit your potential versus just taking the tax hit and going balls to the wall, but I haven't delved too deeply into that comparison. @Daniel Thomas , You will be giving away too much money.Then you roll your existing 401(k) funds into the new plan.
But these tax benefits are only applicable when you abide by the rules of the plan, and these rules limit everything from how much you can contribute to the plan annually to when you can withdraw funds from the plan penalty-free.As you follow sound retirement planning advice and begin or continue to consistently contribute to an employer-sponsored retirement plan like a 401(k), it can be tempting to want some immediate benefit from that account value as you watch it increase.Most people find it difficult to view their retirement savings as being off limits, particularly as more immediate needs and wants arise.We’re sorry, but we were unable to authorize your request.Please call us at 800-433-9196 and provide reference number SWAF-18.6dfcd4d9.1503810723.4e9ba406.