I plan on retiring sometime soon after I turn 50. I started putting money away in a 401K when I started working 14 years ago. I am concerned about investing too much more money in a system that won’t pay out until almost 10 years after I retire. I assume that I will have the same early withdrawal issues with a Roth IRA. Are there tax deferred options that don’t have the 59.5 age requirement?
You can withdraw money from tax-sheltered accounts (IRAs, etc.) before age 59 1/2 under the SEP (Substantially Equal Payments) provisions in the law. Consult your financial advisor for details.
Other than that, my and the hubby’s strategy has been to look for tax-efficient funds. One that we were in for a while generated a taxable event only once every five years, for example.
Since there are contribution limits to 401k/IRA accounts, to retire at that age you will have to be saving/investing in taxable accounts as well.
When calculating your expenses, don’t forget to factor in medical insurance for 15 years.
An earlier thread on this topic recommended this forum: Early Retirement & Financial Independence Community
You can always withdraw your principal from a Roth IRA. You paid tax on that before you contributed it. The rules on withdrawal penalties for Roth IRA earnings are explained here: What is an Individual Retirement Account (IRA)? | The Motley Fool