How to Access Retirement Funds Early Using the 72(t) Strategy

BiggerPockets Money Podcast

BiggerPockets

Investing, Education, Business

4.6 • 2.9K Ratings

🗓️ 13 June 2025

⏱️ 61 minutes

🔗️ Recording | iTunes | RSS

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Summary

On this episode of the BiggerPockets Money Podcast, hosts Mindy Jensen and Scott Trench sit down with John Bowens from Equity Trust. John is an expert on the often-overlooked 72(t)t rule that could be a game-changer for early retirees. This often misunderstood withdrawal strategy allows people under 59.5 to tap into their retirement accounts without facing the brutal 10% early withdrawal penalty that typically guards these funds. John breaks down the complex world of Substantially Equal Periodic Payments (SEPP), walking listeners through the different calculation methods, critical liquidity considerations, and smart investment strategies that can make or break a 72T IRA approach. In this episode, you'll learn: How to access retirement funds early with the often overlooked 72(t) rule Avoiding 401(k) penalties and using retirement accounts to actually retire early The rules and regulations you MUST follow to withdraw penalty-free And SO Much More! Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	What if I told you there's a completely legal way to access your 401k and IRA money before age 59 and a half without paying that brutal 10% early withdrawal penalty?
0:12.3	It's called the 72T, and it's one of the most powerful yet misunderstood strategies for early retirement.
0:19.4	Today, we're diving deep into exactly how the 72T
0:23.1	substantially equal periodic payment strategy works, who it's perfect for, and the critical
0:28.5	mistakes that could cost you thousands. We are going to dive deep into the numbers, so this is a
0:34.1	great episode to listen to with a notebook and pen to take all the notes.
0:38.8	If you've ever wondered how to bridge the gap between early retirement and traditional
0:42.8	retirement account access, this episode is for you.
0:50.8	Hello, hello, hello, and welcome to the Bigger Pockets Money podcast.
0:54.1	My name is Mindy Jensen.
0:55.3	And with me, as always, is my substantially equal but not periodic co-host, Scott Trench.
1:00.9	Hey, Mindy, what's up? What's up? Bigger Pockets has a goal of creating one million
1:05.4	millionaires. You're in the right place if you want to get your financial house in order
1:08.6	because we truly believe financial freedom is attainable for everyone, no matter when or where you're starting, or whether all that
1:14.5	money is in retirement accounts and you want to access it or get better returns in those accounts.
1:18.9	We are so excited to bring on an expert on this topic, John Bowens. John is the director and head
1:23.3	of education and investor success and equity trust. Really excited for this conversation today.
1:27.7	John, welcome back to the Bigger Pockets Money podcast. Thank you, Scott and Mindy. Always good to be here.
1:33.4	John, I am so excited for this episode because the 72T is something that I have been looking into
1:39.6	just because it's a great option. I'm not yet 59 and a half, not for a while. So this looked like
1:46.6	something very interesting. But before we jump into it, let's define for everybody what the 72T is
1:53.0	and what we're talking about today. Yeah, so I always like to start, Mindy, where does 72T come from?
	...

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