Two people work across the street from each other. Same age, 56. Same job title. Same $800,000 in their 401(k).
Both decide to retire.
One of them withdraws $60,000 from the plan, pays ordinary income tax, and goes to lunch.
The other one is told the plan does not permit partial withdrawals. Their only options are to take the entire $800,000 at once, which would be a tax catastrophe, or roll it to an IRA, which triggers a 10% early withdrawal penalty on anything they touch before 59 and a half.
Same law. Same age. Same money. Completely different retirement.
Federal law sets the ceiling. Your employer writes the floor, the walls and the doors. Most of the rules that will decide your retirement are not in the tax code. They are in a document your HR department has never mentioned.
That document is called the Summary Plan Description. Today we go read it.