Rule of 55
Also called: age 55 rule, separation from service exception
The rule of 55 lets you withdraw from the 401(k) of the employer you just left, penalty-free, if you leave in or after the year you turn 55. It applies only to that plan, not to IRAs and not to old 401(k)s from previous jobs. This creates a genuine trap: rolling the account into an IRA for lower fees permanently forfeits the exception, so early retirees should decide the sequence before moving anything.