Newbie question

[getwet]

My wife and I wanted to get more serious about our retirement investments this year and plan to put 4K each into Roths and 15% of my salary into 401K. Here's a dumb question: If we are lucky enough to retire a bit early, can we withdraw money from the Roths without having to pay penalties? If not, should we take some of our investment money and put it into mutual funds or other investments that we can live on before 59-1/2? I am 30 and my wife is in her 20's.

Thanks you for your help.

[crazy connie]

Under IRS Reg known as 72T you can take funds early from IRA. You will see lots of info around on it and it is know as SEPP (substantialy equal periodic payments).

[Nords]

Welcome to the board, Getwet!

Quote:

Originally Posted by getwet Here's a dumb question:* If we are lucky enough to retire a bit early, can we withdraw money from the Roths without having to pay penalties?

You can withdraw Roth contributions anytime. There are special circumstances for withdrawing more than that, which you can read about in a variety places-- Fairmark.com, Ed Slott's book, and IRS Pub 590...

[ladelfina]

What you can do with a Roth is take out the amount you put in at any time without taxes or penalties, so in that way it's superior to other retirement accounts. So depending on what your timeframe is and how much you are able to put in, you could have enough for a couple years of "early" retirement by taking out only your contributions and letting the rest grow. At least that's how I understand it.

[Ed_The_Gypsy]

Quote:

What you can do with a Roth is take out the amount you put in at any time without taxes or penalties,

For the rest, you have to wait 5 years before you can take it out.

[getwet]

Thank you all for the helpful replies. I have been lurking on this site for awhile and have really enjoyed learning from you all.