What is better, withdrawling early from an IRA or Roth IRA first? or both at the same time?
someone sent me this question and it stumped me for a sec. why withdrawl early at all? we all know it can lead to a penalty. but if these accounts are the only assets left, and retirement age is still far off, which one goes first? the IRA or the roth IRA or both at the same time?
i'm thinking the IRA goes first. what do you think?
You shouldn't withdraw from either, obviously, but if you need to you can withdraw your CONTRIBUTIONS from a Roth IRA with no penalty. If you withdraw beyond your contributions from a Roth IRA you will face a significant tax penalty, as you have already been taxed on those funds (when you earned them the first time).
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