Payment options

You have the same payment options (described below) whether you are enrolled in a 401(k) Plan or 457(b) Plan. The only difference relates to age: if you take payments from your 401(k) Plan before age 59 ½, you may be subject to an additional 10 percent federal tax and, if you are a California resident, 2.5 percent state tax. However, these additional taxes generally do not apply if you:

  • separate or retire in or after the year you reach age 55;
  • retire due to disability; or
  • require the payment for medical expenses.

You must be separated from employment or age 59 ½ or older to receive payments from your 457(b) account.

All payments are subject to federal and state income taxes. See Taxes for more information.

If you have an SDBA, certain and different requirements apply. Please contact Schwab for more details.

You can model payments to see examples of what your payments would be, using the fixed period or fixed amount payment options described below.

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