No CPG does not allow loans under the 401k program. The plan does allow a Hardship Withdrawal per IRS regulations:
- The employee has to contact Principal directly to initiate this. HR nor Payroll has any involvement in the process.
Some common types of Hardship withdrawals
- Pay for funeral costs for a family member
- Purchase a home or prevent a home from going into foreclosure
- Pay for medical bills going into collections
- Pay for secondary education for yourself or an immediate family member
CPG things to remember
- If you have a hardship withdrawal issued, you can't contribute to the plan for 6 months.
IRS things to remember
- If you are younger than 59 1/2 you will pay taxes on the withdrawal via the current tax rate
- If you are younger than 59 1/2, you will pay a 10% early withdrawal penalty.
- If you are older than 59 1/2, you will not pay a 10% early withdrawal penalty, but you will pay appropriate taxes on the withdrawal.
Principal's main contact phone number is 800-986-3343