Author Topic: Am I doing it all wrong?  (Read 2468 times)


  • Bristles
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Am I doing it all wrong?
« on: November 11, 2015, 01:23:37 PM »
I recently found this forum and it has been changing how I think about retirement a bit.  I always knew I wanted to reitre early but I was targeting something around 55-60 as my retirement age which works out well because I can access my retirement money at 59.5 and I could probably cover a few years before that age pretty easily.  However, now that I am thinkink of an earlier retirement I am slightly concerned that most of my money is locked up in 401k's or roth's.  Am I saving for retirment the wrong way?



NW of 970k of which 620k is locked in retirement accounts and 220k is locked in home equity.  The remainder is split between cash and taxable investments.  We max out our roth's and 401k's to reduce our tax burden but it doesn't do me a whole lot of good to have a massive 401k if I can't touch it for another 28 years.  What do you think?


  • Magnum Stache
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Re: Am I doing it all wrong?
« Reply #1 on: November 11, 2015, 01:26:44 PM »
Look through the FAQ or start researching Roth pipeline/SEPP.

Alternatively you can focus on lowering your expenses so that early withdrawal penalties are paltry.


  • Handlebar Stache
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Re: Am I doing it all wrong?
« Reply #2 on: November 11, 2015, 01:44:25 PM »


  • Walrus Stache
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Re: Am I doing it all wrong?
« Reply #3 on: November 11, 2015, 02:09:02 PM »
Your money is not locked away. You can withdraw it at any time after you leave your job. Roth contributions can be withdrawn with no tax or penalty due at any time. You'll have to pay a 10% extra tax on traditional retirement account balances if you withdraw them early, but this is still much different than a "lock" that means you "can't touch" this money. There are even ways around this tax, including the Roth pipeline and "substantially equal periodic payments."

See and for more information about these options.

Also if you leave your job after age 55, you may withdraw directly from that job's 401(k) (but not other 401(k) or IRA accounts) at that time without owing the 10% early withdrawal tax.
« Last Edit: November 11, 2015, 02:10:45 PM by seattlecyclone »