In the process of researching a Vanguard Roth IRA account I saw that you are allowed to withdraw without a 10% tax penalty if you are a first time homebuyer. FTHB.
Vanguard IRA Accounts
I also read further and understand, if you aren't a first time homebuyer but your spouse is, than both you and your DH can both withdraw penalty free.
ou can put up to $10,000 of IRA funds toward the purchase of your first home. If you're married, and you and your spouse are first-time buyers, you each can pull from retirement accounts, giving you $20,000 in residential cash.Even better is the IRS definition of "first-time homebuyer." Technically, you don't have to be purchasing youI cr very first abode. You qualify under the tax rules as long as you (or your spouse) didn't own a principal residence at any time during the previous two years. In fact, you can even share your IRA wealth. The IRS says the first-time homebuyer using your IRA funds for a down payment can be you, your spouse, one of your children, a grandchild or a parent."
When Can You Dip Into Your Roth IRA? | Fox Business
I can see some benefits to this. You are planning to buy a home in 2 years and you already have the cash outside of your IRA.
In 2 years if you don't need the IRA money for the dowpayment, more power to you. If you do need it, it will be there with 2 years of potential gains.
Yes if you take it out it could cost you more working years, but if interest rates are low etc now and the market continues to roar it might be a wise move.
What are your thoughts on this and has anyone done this themselves or known anyone to do this. Specifically utilizing the DH as a FTHB?
Also, if my DH buys the home, can I use this same IRA withdrawal after the 2 years of me not owning a residence, or will the prior DH FTHB purchase negate that opportunity?