Posted on 06/18/2016 7:08:00 AM PDT by George from New England
Wife worked full-time at an organized church office for 9 1/2 years now. Worked 35 hours a week and received insurance and health care benefits, etc.
Fiscal year cycles at June 30. She was the elimination of her position this past week and given the option to continue at 19 hours a week, part time. She has said no, she needs a job with benefits. They surprised her yesterday, Friday, with her last day worked. Their letter says she is paid until end of June and 4 weeks into July for sick days and left over vacation time.
Now her termination letter say June 17th.
Her birthday is Dec 24, 1956 -- which makes her 59 1/2 in one week, June 24th this year.
Does legal status change once ones passes the 59 1/2 age when it comes to retirement laws or is that half birthday only relevant to penalties on i.r.a. account withdrawls? Could the difference of one week, change her ability to get early pension benefit or are there laws surrounding 59 1/2?
This is the state of Florida and one of the Catholic Dioceses down here.
Sorry to hear the news.
Prayers up for you and your wife.
If you just want to remove 401K money without the 10% penalty, then wait to 59 1/2. However, take advantage of unemployment pay. All will be taxable income.
That’s some loyal church. Prayers up!
I have only heard of the 59.5 rule for withdrawing 401k and IRA money without the 10% penalty.
Pensions have their own rules. I know some retired policemen that starting pulling from their pension at age 47...
Many churches are downsizing their staff and cutting ministries. Generous tithers are dying off.
I was going to respond to that last sentence but I could not control my temper.
Thanks Frank!
You can roll the 401k into an IRA without any penalty
“I know some retired policemen that starting pulling from their pension at age 47...”
I do too.
.
I know that taking out a 401K prior to the time set up in the program results in a heavy tax penalty.
She is 2 and a half years away from early SS. She can't qualify for Medi-care until 65.
Personally, I would begin some serious research. Better late than never. As far as SS is concerned, go on their site. It will give you information that you will need for SS.
Check with you 40lK provider to find out those rules.
Remember, this is up to you.
She needs to find out the rules for retirement at her particular work place. 9 1/2 years sounds kind of short for retirement benefits at 59.
Employment is at the will of employer.
You can pull from 401 b4 59.5 under the 72T rule
http://www.investopedia.com/terms/r/rule72t.asp?o=40186&l=dir&qsrc=999&qo=investopediaSiteSearch
Change of pastor after 7 years and vendetta where everyone has left. List of departees ...
After one year
Office manager left
Maintenance person left
One aging deacon fired
Organist left
Other deacon gone
Youth minister gone
Secretary/receptionist position gone
After one year now, money squandered so they have no budget for a receptionist and secretary. Goal is to acquire all volunteers. We have to celebrate since the new pastor who is the bishops close buddy, has an almost brand new home for rectory with a beautiful pool and mortgage to boot.
My wife used to answer phones while doing everything else. Now there will be a machine to take all calls, and only contact will be through callbacks that are deemed necessary.
Big congregation turn over too.
These things do happen. All the trouble I ever had on jobs came from a new boss or a new supervisor. No matter how much I enjoyed the job this switch often brought great trouble.
Sorry for you and your wife. It happened to my husband several years ago (a SJWing) but we ended up surviving.
59.5 means zero to the employer.Probably coincidence.
As another poster stated the part time may may’ve paid for COBRA till she could land some thing else.
A number of possible motives. Definitely business expense related. Reducing her to less than 30 hours a week eliminates the Obamacare mandate of providing her coverage (assuming the church has 50 or more employees).
Also, at age 59-1/2 she is eligible to begin receiving distributions from her tax deferred IRA and retirement plans without paying the 10% premature distribution penalty.
In other words, her employer is in a cash bind and needs to reduce expenses. At age 59-1/2 it hits your spouse less hard than if it were an employee who was younger due to the additional penalty they would pay to dip into their retirement savings.
You may have an ADEA claim given that your wife is over 40, but many more facts would need to be developed before running down that road (did anyone younger than 40 get axed too?)
Here, correction officers can draw early retirement with the 80-something rule. Don't recall the exact number but it's years employed + age = 80-whatever.
Sorry, can't help the op.
Parmy, I also would have taken part time and looked for another position or something part-time to fill in. To me, if they need to downsize, it doesn’t really have to do with the wife but rather with the money they have available. Most of us don’t have full benefits, etc. - that is a luxury these days. The Lord will provide; I bet, with her skills, she’ll find something even more interesting.
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