DEFINITION of 'Withdrawal'

Removing funds from an account, plan, pension or trust. In some cases, conditions must be met in order to withdraw funds without penalization. There are two ways to withdraw money: in cash or in kind.

BREAKING DOWN 'Withdrawal'

Withdrawal can be done over a period of time in fixed or variable amounts or in one lump sum. Penalization for early withdrawal usually arises when a clause in an investment contract is broken. Cash withdrawal requires converting the holdings of an account, plan, pension or trust into cash, usually through a sale. In kind withdrawal is simply taking possession of assets and does not require conversion to cash.

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