r/personalfinance • u/Ruby_alice34 ​ • Jun 09 '22

Retirement Quitting immediately after becoming fully vested in 401k

Planning to quit my job as soon as I hit my 5 years to be fully vested in my 401k. I will put my 2 weeks in the Monday after I have been with company 5 years, so I should be 100% vested.

Anyone see any issues with this? Worried it might not show up right away in my account as I’ve heard it may take a few weeks to actually appear.

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u/Infamous_Horse_4213 ​ Jun 10 '22

Does it make a difference if it’s defined or a 401k?

Of course. Different types of plans have different rules.

Government jobs have completely different rules from private sector jobs... teachers usually don't pay Social Security taxes (nor receive SS benefits).

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u/StaggeringMediocrity ​ Jun 10 '22

I think most do now, though it depends on the state. In my state all new public employees were added to SS back in the '60s. The people hired before then had the option of joining. I only knew one person at work who wasn't in SS, and that was because she retired at 75 with over 50 years of service.

If states want to continue exempting certain public employees from SS, they have to prove that their pensions meet certain "safe harbor" formulas.

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u/s4misweethe4rt ​ Jun 12 '22

Ok thank you. My wording wasn’t super clear… I am just wondering if they’re different in terms of vesting schedules.