3127: How To Get Your Money Out Of Your 401K Before 59 1/2 by Wanderer of Millennial Revolution

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🗓️ 1 May 2025

⏱️ 12 minutes

🔗️ Recording | iTunes | RSS

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Summary

Discover all of the podcasts in our network, search for specific episodes, get the Optimal Living Daily workbook, and learn more at: OLDPodcast.com. Episode 3127: Wanderer breaks down how to access your 401(k) funds before age 59½ without paying penalties, using a strategy called the Roth Conversion Ladder. By carefully rolling over 401(k) funds into a Traditional IRA and then converting to a Roth IRA within tax-free limits each year, you can build a systematic way to unlock your retirement savings early and maximize tax efficiency. Read along with the original article(s) here: https://www.millennial-revolution.com/invest/get-money-401k-59-1-2/ Quotes to ponder: "Money inside your 401(k) is kinda like a raw pot roast. You can’t eat it right away." "It’s all based on the IRS rule that Roth IRA conversions, rather than contributions, can be withdrawn penalty-free 5 years after the conversion has taken place." "When you do quit, you roll-over all of them into a Traditional IRA. This is done tax-free." Episode references: How to access retirement funds early by Mad Fientist: https://www.madfientist.com/how-to-access-retirement-funds-early/ Learn more about your ad choices. Visit megaphone.fm/adchoices

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1:00.3	This is Optimal Finance Daily. How to get your money out of your 401k before 59.5.
1:08.7	By Wanderer of millennial-revolution.com. For some reason, I've been doing a string of
1:16.3	tax articles lately that have been surprisingly well received, so I figured I'd keep going. Why ruin a
1:23.1	good thing, right? 401ks. They're great, aren't they? They let you defer taxes on your income,
1:30.3	giving you a tax refund, and anything you earn in them is tax-free. The only problem is
1:36.1	there's a catch. Money inside your 401k is kind of like a raw pot roast. You can't eat it right
1:43.1	away. First, you have to withdraw the money,
1:45.9	just like you have to cook the pot roast before eating it. And like a pot roast, if you cook it too
1:50.9	fast, then the whole thing gets burnt to a crisp and you have to hack off half of it just to find
1:57.0	something edible. Anywho, the point is, because 401k withdrawals are taxed at your marginal
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