roth ira withdrawalThe Roth IRA was created in January of 1998. There are many benefits over the traditional IRA but you need to be aware of the Roth IRA withdrawal limits. The biggest advantage of the Roth IRA is all earnings are tax free if you meet the requirements set forth by the government, and Roth IRA qualifications are pretty lenient. The only drawback is you can not get a tax deduction when contributing to the IRA.

You should try everything before having to resort to withdrawing your funds because the biggest problem is that you are hurting yourself from future growth. Because the Roth has a yearly maximum contribution, you will not be able to catch up for lost time if you take funds out. Although there are four Roth IRA withdrawal limits, only one of the following qualifications needs to be met in order to withdraw your money without penalty.

1. The owner of the Roth IRA has to be fifty-nine and a half to withdraw funds penalty free. This qualification was instituted to try and help investors keep the money growing until they are at retirement age. If you need to withdraw before then, a 10% penalty is instituted.

2. The withdrawal is made to the Roth IRA owner’s beneficiary or estate, after their death.

3. The withdrawal may be made if the owner is injured or disabled.

4. You can also withdraw the money penalty free if it is used to pay for first time home buyers expenses.

Most people are better off with this type of IRA even with the Roth IRA withdrawal limits. The single biggest plus is the Roth holds after tax dollars. You money grows over the years and at withdrawal time it is all your money, tax-free. You can add greater tax leverage to your retirement savings with the Roth IRA.

In summary, remember the golden rule regarding the Roth IRA withdrawal, once you put the money in don’t take it out under any circumstances.  If you remember this one rule you’ll be amazed how quickly your money will compound.

Related posts:

  1. What Are The Roth IRA Qualifications?
  2. Difference Between A Roth And Traditional IRA
  3. Four Ways To Enjoy A Roth Retirement
  4. Best Roth IRA Account
  5. Your 401k rollover to Roth IRA

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