Retire at 55 rules
With the rule of 55 can I make multiple withdrawals from my 401k without the 10% penalty or am I limited to one withdrawal?
Terry Says
You're talking about Rule 72T (named after that section of the tax code). It allows “Substantially Equally Periodic Payments” to avoid the 10% early withdrawal penalty normally due for withdrawals from an individual retirement account, 401(k), TSP, 403(b), or 457 plan prior to age 59 ½. But you have to follow the rules carefully. You can't just make a few withdrawals and then stop! And remember, you'll still owe income taxes. Even worse, you'll be losing all the future tax-deferred growth in the account. So this is really not a recommended strategy! Here's a link if you want to learn more about Rule 72T
