A 401k retirement plan allows employees to save money during the course of their working career. Your particular policy may have exclusions to the 10% penalty, which will allow you to distribute 401k funds earlier. Though the penalty costs to withdraw are high, the federal government offers a few exceptions to the rule. The federal government allows for a few exceptions to the 10% penalty for an early withdrawal. New In 401 k FHA Loans Home Equity Loans Mortgage Basics Mortgage Calculators Mortgage Loan Education Mortgage Refinancing VA Loans Car Loans Cash Advance & Payday Loans Hard Money Loans Loan Basics Small Business Loans Student Loans Banking & Credit 101 Credit Cards Credit Report Credit-Building & Management Debt Consolidation Debt Settlement Personal Banking Bonds ETF FOREX Trading Investing Basics Metals Resources & Collectibles Mutual Funds Options Stocks 401 k Estate Planning IRAs Living in Retirement Retirement Planning Auto Insurance Business Insurance Disability Insurance Health Insurance Home Insurance Insurance Basics Life Insurance Filing Taxes General Taxes Small Business Taxes Tax Planning Tax Relief Budgeting Planning Basics Saving Buying General Real Estate Home Improvement Renting Selling Banking & Credit Finance Insurance Investing Loans Mortgage & Real Estate Student Taxes