3 Ways to Take Money From Your Roth IRA in an Emergency
When you're hit by a surprise expense or you lose your job, you can only stretch your emergency fund so far. The reality is that in a true crisis, your options are often less than ideal. That may mean you have to turn to your Roth IRA for non-retirement reasons.
A Roth IRA is an individual retirement account that you fund with after-tax dollars. You can then withdraw the money 100% tax-free once you're age 59 1/2 and you've had the account for at least five years.
No matter how old you are or how recently you opened your Roth IRA, you can withdraw your contributions any time without paying taxes or penalties. But the withdrawal rules for your earnings are different. Tap them early, and you'll owe income taxes plus a 10% penalty.
If you're thinking of withdrawing money from your Roth IRA to survive an emergency, here are three ways to mitigate the damage.
Source Fool.com
