If I start a Roth IRA in a couple weeks, and keep contributing $7k per year to it, for years & decades, When will it pay off? When can it be money for me to spend?
And does it multiply while it's invested in the Roth IRA?
As a note, you can't "borrow" from a roth. So if you withdraw principle, you're limited by the max contribution rate in building up the principle again.
So while it's penalty free, there are limitations to keep in mind.
5 Comments
aedyr@lemmy.ca · 12 pts · 2y
Overview is here https://www.irs.gov/retirement-plans/roth-iras , but generally 59 and 1/2 is when you can start taking distributions without penalty.
LemmyKnowsBest@lemmy.world · 4 pts · 2y
59.5 years old. Got it.
thessnake03@lemmy.world · 11 pts · 2y
Money in an IRA doesn't automatically "multiply" as you say. You'd need to invest your contributions into something, like a stock or mutual fund
LemmyKnowsBest@lemmy.world · 1 pts · 2y
Usually_Lurker@lemmy.world · 8 pts · 2y
You can take the principle out without penalty. Profits need to wait until 59 1/2 to be penalty free.
https://www.your-roth-ira.com/withdrawing-roth-ira-principal.html
Fermion@feddit.nl · 6 pts · 2y
As a note, you can't "borrow" from a roth. So if you withdraw principle, you're limited by the max contribution rate in building up the principle again.
So while it's penalty free, there are limitations to keep in mind.