4 ms·

Retire by 40

madengr 9y ago
I thought the same thing, but I’d have no idea what to do without work. If I didn’t have to save for kids college, I could retire now at 46. Other problem is 401k can’t be accessed until 60. Retire for me just means enough FU money, but I’ll probably work till I drop dead.
- ThePadawan 9y ago
  Europe-based engineer here: Is a 401k completely unaccessible until 60? I am currently resident of Switzerland, which has similar restrictions on the tax-free part of retirement savings, but allows earlier withdrawal for reasons such as * purchasing a home (restriction: you have to live there yourself * leaving the country
  - calvinzpinson 9y ago
    There are actually a few ways to get money out of your 401k before the traditional retirement age. It involves rolling the funds over from your 401k into a traditional IRA, and then into a Roth IRA in what is sometimes known as a Roth ladder. Here's an article on it: http://rootofgood.com/roth-ira-conversion-ladder-early-retirement/ http://rootofgood.com/roth-ira-conversion-ladder-early-retir...
  - awinder 9y ago
    The US has a first time homebuyer withdrawl carve-out (which I think is defined as someone who hasn’t bought a house in 8 years?). There are also hardship exemptions. Technically you can withdrawl for any reason but you pay taxes + a 10% penalty.
    - dunham 9y ago
      I believe you can also take a loan from your 401k, but have to pay it back when you switch jobs.
- miguelrochefort 9y ago
  By retiring, I mean not having to work to survive. I'm aiming for an income of around $20,000/year. Then, I'll be able to work on what I really want, without worrying about income.
  - madengr 9y ago
    You’d probably need $400k in investments.
- twiceaday 9y ago
  You can access your 401k before 60. You need to do a rollover into an IRA and then after 5 years the principle is accessible. This rollover is taxable but if you are retired your tax rate can be quite low, even 0% in some states depending on income. You should be in such no-income-tax states if you plan to retire early anyways.

Retire by 40

I thought the same thing, but I’d have no idea what to do without work. If I didn’t have to save for kids college, I could retire now at 46. Other problem is 401k can’t be accessed until 60. Retire for me just means enough FU money, but I’ll probably work till I drop dead.

ThePadawan 9y ago
Europe-based engineer here: Is a 401k completely unaccessible until 60? I am currently resident of Switzerland, which has similar restrictions on the tax-free part of retirement savings, but allows earlier withdrawal for reasons such as * purchasing a home (restriction: you have to live there yourself * leaving the country
- calvinzpinson 9y ago
  There are actually a few ways to get money out of your 401k before the traditional retirement age. It involves rolling the funds over from your 401k into a traditional IRA, and then into a Roth IRA in what is sometimes known as a Roth ladder. Here's an article on it: http://rootofgood.com/roth-ira-conversion-ladder-early-retirement/ http://rootofgood.com/roth-ira-conversion-ladder-early-retir...
- awinder 9y ago
  The US has a first time homebuyer withdrawl carve-out (which I think is defined as someone who hasn’t bought a house in 8 years?). There are also hardship exemptions. Technically you can withdrawl for any reason but you pay taxes + a 10% penalty.
  - dunham 9y ago
    I believe you can also take a loan from your 401k, but have to pay it back when you switch jobs.
miguelrochefort 9y ago
By retiring, I mean not having to work to survive. I'm aiming for an income of around $20,000/year. Then, I'll be able to work on what I really want, without worrying about income.
- madengr 9y ago
  You’d probably need $400k in investments.
twiceaday 9y ago
You can access your 401k before 60. You need to do a rollover into an IRA and then after 5 years the principle is accessible. This rollover is taxable but if you are retired your tax rate can be quite low, even 0% in some states depending on income. You should be in such no-income-tax states if you plan to retire early anyways.