| | I was almost convinced that my employer experienced a fit of paternalism at some point and set up the retirement plan in a way that no cash withdrawals are possible if one is still working full time. ... But it turns out that my employer’s hands are tied by federal law. I am not convinced of the latter. Chapter 4 of ERISA has provisions about when a plan must pay benefits, when it may pay benefits (e.g early retirement or disability), but little or nothing about when it may not pay benefits. Employers may be more restrictive within the bounds of Chapter 4. What an employer may optionally allow or not allow much depends on the type of plan it is -- defined benefit (traditional or cash balance), money purchase, 401(k), profit sharing, ESOP (link). For a traditional defined benefit plan to pay benefits before a full retirement significantly complicates its design (as does an employee retiring and then later returning to work with the same employer). So it would help to know what type it is and what the restriction is.
(Edited by Merlin Jetton on 10/04, 12:38pm)
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