Early withdrawal at 55 no penalty from 40l(k)

Terry Says

I don't want to answer  your question!  (But I will, below.)  I don't want you to take ANY money out of your 40l(k) because you will need it in the future more than you think you need it today!!  And you will be giving up years of tax-deferred growth that could turn into a lot of money. So, PLEASE DON'T DO IT! That said, there is a provision that allows you to take money out of a 40l(k) without penalty (though you still would have to pay income taxes).  But it basically liquidates your retirement plan over five years.  It's called Rule 72t for the income tax code provision.  Here's what it says: Rule 72(t), issued by the Internal Revenue Service (IRS), permits penalty-free withdrawals from IRA accounts and other tax-advantaged retirement accounts like 401 (k) and 403 (b) plans. There are provisions to the rule: the owner takes at least five substantially equal periodic payments (SEPPs), with the amount depending on the owner’s life expectancy as calculated through IRS-approved methods. This rule also permits account holders to benefit from their retirement savings before retirement age, through early withdrawal, without the otherwise required 10% penalty. The withdrawals are still taxed at the owner’s normal income tax rate. Read more: Rule 72(t) https://www.investopedia.com/terms/r/rule72t.asp#ixzz56rbDr2F3