[USER]

Super simple question I can’t figure out: If you’re FIRE, how do you pull funds out of your traditional IRA?

I’m guessing it’s a 10% penalty and then you also pay tax on the withdrawal, but if you have no income, you could take it out small amounts to be in the lowest tax bracket. Right?

[Linda]

It is age dependent. Your assumption is correct on the early withdrawal penalty if you are below 59 1/2. You would pay income tax based on your taxable income in the withdrawal year. Hopefully you have planned things out and have brokerage accounts you can withdraw from first.

[Eric]

People that are fired planned ahead and just take funds from places that have no penalty.

And/or did the rule of 55/72t.

[Justin]

Look into a Roth IRA ladder.

[Elizabeth]

Please search the group. This gets asked frequently. Additionally, please post things like this under your own name as it doesn’t require anonymity.

[Jason]

You can pull out contributions that have been in there for at least 5 years (just not the growth), like people mentioned there are good articles & YouTube videos on Roth Conversation ladder that would help explain things in more detail. My plan is to have 2-3 years in savings and a good portion of money in a taxable brokerage account before retiring so hopefully we don’t have to tap into the Roth IRA for quite a while.

[Author]

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