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You are thinking of withdrawing all your funds; $45,000 from your 401 (k) at age 54. The normal tax rate for you would be 28%. The rules for withdrawing funds before the age of 59 1/2 is a 10% penalty. How much would you save if you waited until age 59 1/2?

Respuesta :

The saving amount is $3,240.

  • The calculation is as follows:

The money left after tax is

[tex]= $45000\times (1 - 0.28)\\\\= 45000 \times 0.72[/tex]

=$32400

At 59.5, money left after tax is

[tex]=$45000\times (1 - 0.10)\times (1-0.28)\\\\= 45000\times 0.90\times 0.72[/tex]

=$29160

So,  

Saving money should be

= $32,400 - $29,160

= $3,240

Learn more: brainly.com/question/17429689

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