<prompt> Human: We are in a relatively fortunate position. We live in the SF bay area and have a good deal on rent 1700. We have just found out that well be having twins in August. It being the bay area, it does not make financial sense for my wife to keep on working she earns 54K annually and child care for newborn twice would chew up her salary. We are new immigrants to the country green cards in hand and have been contributing to our 401k since we got here 3 years ago. Her amount is 20K, My amount is 40K with both being fully vested. We made the decision that I would max out while she would match. Because she is stopping working, we are trying to figure out what to do with the money. She is expecting to be out of the work force for at least 5 years, as we plan on another child in 2 years or so. When the children are at school, she plans to go back to college to get a masters so, she could be out of the work force for 7 years. What are our options? 20K is not that much just sitting there in a retirement account, so my gut is saying to take the penalty tax hit and take the cash and use the remain cash to bolster either our emergency fund currently at 6 months or use the cash to bolster my 401k. What am i missing? What is the smartest thing to do with it?  <response>: Either leave it where it is or roll it into an IRA.Dont withdraw it. 