My husband is an ironworker, so I know exactly what you are going through.

It's pretty tough right now (and has been for a number of years). The union that my husband works for won't let him have access to his 401K until six months after he quits. By the time we knew about this, there was no way that we could wait that long to receive his 401K, so he was stuck in his job despite the lack of work. We had gone through all of the savings, so it was going to be impossible for us to wait for a check, even though it was large, without income to pay basic water, electric, and even food.

To answer your question, if you officially quit/resign from your job, you will no longer qualify for unemployment, so your 401K will not impact benefits, because you will no longer be eligible for benefits at all.

I would suggest seeing if there is a way you can take a loan out on your 401K. This shouldn't impact your benefits since you have to pay it back (but report it on the claim form and indicate it is a loan). If your union is similar to my husband's, they don't allow loans on the 401K plan.

The only other option is to collect unemployment, apply for another job, and then quit when you find another job (and cash out your 401K). The bad thing about this is that the job you find to replace your current job will probably pay three times as less. So, working one week or even 25 hours in a week at your current job would be like working three or four weeks at a new, lower paying job.

It's certainly a catch-22 for union workers and well-paid construction workers, especially since all of our bills are based on a full-time job that pays well (house payment, car payment, credit card payment, etc.).

My husband's union also put a new stipulation in the 401K plan indicating that a worker will not be eligible to receive a payout of the 401K if the worker finds a job in the same or similar line of work (i.e. any type of construction). Lovely for us--not.

So, no, you can't quit and collect unemployment. And as long as you are still employed, no matter how underemployed, you are unable to cash out your 401K. It's very frustrating knowing that you have so many tens of thousands of dollars that you don't have access to, especially because the quality of life that you are currently living (and us) is less than that of the normal person.

If you resign your position then you will lose your unemployment benefits. There should be no reason for you to have to quit your job if you have already been laid off. You also can liquidate your 401k at any time if you are no longer employed by the company that holds the 401k. The issue with this is the taxes. Not only will you pay income tax on this but there is a 20% penalty for widthdrawing the money. Since you are laid off a loan is not an option because a loan means that you are paying it back each week with an amount from your paycheck. You have no paycheck so there is no way to repay the loan. Your employer has no reason to try to get you to quit other than they are probably getting killed with the unemployment insurance costs since they laid everyone off. You can contact the company that administers your 401k and see what has to be done to take out your 401k money. Just plan on setting aside enough to cover taxes (income) and penalties. You will need to be able to prove hardship in order to get the money as well. This should really be a last resort as when this is gone there is nothing else for you to draw from. See where you can really cut expenses and see what you can find as far as work as an independent contractor. Times are hard but what your employer wants you to do is not in your best interest.