Withdraw Retirement Funds Early? Yes You Can!

Withdraw Retirement Funds Early? Yes You Can!

Can you access your investments and withdraw retirement funds early?

When I say withdraw retirement funds early, I mean before the age of 59 1/2. If you are a fan of Financial Independence, there is a significant chance you will have accumulated a required level of wealth, and have the option to no longer work for money, before the traditional retirement age.

If you don’t have a pension that covers your expenses, you may need to get your hands on your hard invested money to live on. But what about all those penalties if you withdraw from your retirement accounts before entering your sixties?

IRS 72(t) Withdrawal Strategy

You can withdraw retirement funds early

There’s a myth that claims you can’t get your tax deferred money until you turn age 59 1/2. The reality is that money you save in standard retirement accounts is available to you if you wish to access it.

There are a number of methods you can use, legally and without penalty, to access your invested funds prior to reaching traditional retirement age. By far the most popular methods are the Roth Conversion Ladder and the 72(t).

For the retiree in their fifties, the Rule of 55 for withdrawing from a 401(k) is one method to explore.

If you think you’ll need to withdraw your retirement funds early, it is important to understand these techniques now so you can feel confident in executing your plans for funding for, and withdrawing in, retirement.

The types of retirement accounts you have available to you will determine what withdrawal strategies to pursue. Other factors to consider include contribution matching, account balance, future sources of income, and others.

Learn as much as you can, you may be surprised just how beneficial these techniques can be. Tax laws do change and at some point your ability to execute these strategies may change. As always, do your own research and ensure you are in compliance with the IRS codes.




Take Action:

  1. If you were not previously aware of this handful of techniques, keep them in mind as you deliberate how to shape your financial picture and take great care on how you will access the funds you will need to fund your expenses long before you reach traditional retirement age. Congratulations on making it this far. Financial Independence is an amazing journey and I hope you are enjoying yours!

Additional Resources:


The price of anything is the amount of life you exchange for it.”- Henry David Thoreau

David Baughier

My passion for helping others led to the curation Fiology. Help me spread the message of Financial Independence by clicking a colorful link above and sharing this post on your favorite social platform. Thank you!


  1. Tim Griesdorn on April 20, 2021 at 12:50 pm

    Why don’t you mention substantial periodic payments? As long as you take out payments for at least five years you can avoid the 10 percent tax penalty.

    • David Baughier on April 20, 2021 at 2:43 pm

      Thanks Tim, let me do some research and get this included. Appreciate your help making Fiology even better.

    • Miko W on September 6, 2022 at 7:58 pm

      Hi Tim, substantial periodic payments or SEPP is the same as 72t. 72t is the tax code that allows for SEPP. This is an awesome retirement strategy that I’ve been using for a year now.

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