05/22/2026
My client almost made a $468,000 mistake this week.
He called me in a panic.
House in forbearance. Mortgage past due. Bank breathing down his neck.
His plan: pull $180,000 from his 401K to save the house.
"I've got $900K in there," he said. "I can afford it."
Here's what nobody told him.
That $180,000 withdrawal doesn't net him $180,000.
It nets him $108,000.
The IRS takes 10% off the top — $18,000 — gone before he sees a dime.
Then federal taxes hit.
Then California piles on.
Combined rate: 30%.
Another $54,000 gone.
He was expecting $180K. He was getting $108K.
And he still might lose the house anyway.
But here's the number that made him go completely silent on the phone.
That $180,000, left alone at 7% until age 59½?
It becomes $468,000.
He wasn't withdrawing $180K.
He was destroying $468,000 of his future retirement.
And he had no idea.
Here's what makes this worse.
Most CPAs would have just processed the withdrawal and sent him the tax forms in April.
That's not a tax strategist. That's a tax preparer.
There is a massive difference.
A strategist would tell him about the NEW 2024 SECURE 2.0 exceptions almost nobody knows exist:
→ $1,000 emergency personal expense — penalty-free, once a year, no questions asked
→ $10,000 for domestic abuse survivors — penalty-free, repay over 3 years
→ Up to $22,000 if you were hit by a FEMA-declared disaster — California wildfire victims, this means YOU
→ Terminal illness — full penalty waiver
→ The PLESA account — your employer can now fund a penalty-free emergency savings account attached to your 401K
He didn't need to raid his retirement.
He needed someone in his corner who actually knew the rules.
If you have a 401K, a business, and no real tax strategy — and you're making financial decisions out of fear right now — we want to talk to you.
A real conversation about your actual numbers.
Book a free discovery call with me here 👇
Call now to connect with business.
