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Episode 3127:
Wanderer breaks down how to access your 401(k) funds before age 59½ without paying penalties, using a strategy called the Roth Conversion Ladder. By carefully rolling over 401(k) funds into a Traditional IRA and then converting to a Roth IRA within tax-free limits each year, you can build a systematic way to unlock your retirement savings early and maximize tax efficiency.
Read along with the original article(s) here: https://www.millennial-revolution.com/invest/get-money-401k-59-1-2/
Quotes to ponder:
"Money inside your 401(k) is kinda like a raw pot roast. You can’t eat it right away."
"It’s all based on the IRS rule that Roth IRA conversions, rather than contributions, can be withdrawn penalty-free 5 years after the conversion has taken place."
"When you do quit, you roll-over all of them into a Traditional IRA. This is done tax-free."
Episode references:
How to access retirement funds early by Mad Fientist: https://www.madfientist.com/how-to-access-retirement-funds-early/
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