Lever up home or tap Roth equity?

[qwerty3656]

I plan to retire at the end of the year. Most of my money is in tax deferred accounts and I'm not yet 59 1/2 (I'm 58). I planned to pull out some Roth contributions, but I'm thinking it my be better to refinance my home and live off that. Since I'm still working now, I could qualify.

 

[pb4uski]

Yes, that or use a HELOC to bridge that 1-1/2 years until you have penalty free access to your tax-deferred money.

 

[Out-to-Lunch]

I assume the answer is "no," but could you have any Rule-of-55 access from yor deferred 401(k)-type accounts.

EDIT: On the next post I was reading, I see that you were teaching others about the Rule of 55. So I guess you don't have it!

 

[harley]

That's a tough call. I'd hate to pull money out of a Roth, but doing a cash out refinance usually results in a higher rate. If you have the option for the HELOC that pb4 mentioned I'd do that.

 

[levindb]

Check your Roth ROI and compare it to your refinance or HELOC rates…after taxes if you itemize. That should give you a good data point to help you decide.