Originally Posted by dvalley
Currently most of my assets are in tax deferred accounts but if I ER at 48/50 I'll need access to (some of) the money before I'm 59.5yo so I thought ROTH could help there as I could at least pull my contributions (potentially 10-12years worth) if I need to.
I can't do that with t-IRA (well may be with 72t?).
You would not have any Roth contributions with your scenario described.
They would be Roth conversions which are treated a bit differently during Non-Qualified (ie under 59 1/2) distributions. They still have the potential to be penalty and tax free as long as you understand the rules and set things up appropriately. I believe that one of the big differences between Non-Qualified contributions and conversions is that each conversion has it's own 5 year waiting period. If you wait until you are retired to begin the conversions as Alan suggests, you may need 5 years worth of living expenses from non-retirement assets to avoid penalties.
FWIW I am in a very similar situation as you. I am currently 49, FIRED several years ago, DW plans to work 4 more years. Both DW and I had access to After Tax contributions in our 401k plans so since 2010 we have both been contributing the IRS max ($52,000 in 2014). We would then convert these after tax contributions to Roth IRAs with no tax due, being after tax money and all that the "basis in the IRAs has been isolated".
What this has allowed us to do is build up tax-diversity in our retirement assets. If the tax laws change in the future, we can change our withdrawal strategy in that we will have both tax-deferred and Roth assets available in close to a 50:50 distribution.
The issue is how to fund living between the age of 53 (when DW retires) and when I turn 59 1/2 (about 6 years later)? My current plan is to monitor my available non-retirement assets during the next 4 years. If it looks like they may be short of what is required to fund the 6 years until 59 1/2, we may forgo the $52,000 yearly deferral to the after-tax 401k for a few years to supplement our free funds to get us to 59 1/2.
Please keep us informed to your strategy and progress.