Lost W-2...job what to do with 401k?

[Daniel Welch]

I’m a beginner and was in the process of saving cash to begin investing but.....

I just lost my W-2 job and have a chunk of money in my 401k. I have considered rolling it into a self directed ira to begin purchasing buy and hold investment properties. Is their any way to make monthly income off of those or does all money made have to stay inside the IRA? I really want to submerge myself in real estate and never have a W-2 job ever again. I currently live in a paid for house and have 3 kids as well! I have enough funds to live on for a year but am willing risk some of that for some monthly cash flow.

I’ve worked hard up to this point financially to be in this position and am just looking for some guidance as if you were in the same position.

[Dmitriy Fomichenko]

@Daniel Welch

There are couple ways you could access your IRA/401k funds early without penalties (you can't avoid taxes) but this requires advanced planning and may or may not make sense for you. After all, you still will need money after 60, that is what retirement accounts are designed for, to provide for your financial needs when you retire.

But in the meantime you need to support your family now so you would have to figure out a source of income, you don't have to go back to W-2 for this, there are many other ways you could make money while you are working on building passive income.

Now that you have access to your 401k and if you know how to get returns better than stock market - self-directed IRA might be a way to go. I personally prefer private lending using my retirement funds, three main reasons for this are: it is completely passive, low risk (make sure  you do your due diligence on the collateral) and nice returns (I average over 10%). 

Hope this helps!