Withdrawing From Your IRA: A Guide to the Basic Distribution Rules
by Clark M. Blackman
IRAs (individual retirement accounts) are powerful savings vehicles in which to save for retirement in a tax-deferred, and in one case, tax-free environment.
Generally speaking, an IRA is a vehicle similar to an employerÂ’s 401(k) in that contributions grow tax deferred. It is important to note that an IRA is not an investment per se, but a means to invest retirement dollars in a tax-advantaged way. Think of the IRA as a pot with certain tax advantages, into which you must put an investment. You still need to make investment decisions based on your own risk tolerance and investment philosophy.
In this article
- Types of IRAs
- Early Distributions
- Avoiding the Penalty
- Employer Plan Issues
- Distributions After 70½
- Roth Distributions
- Bottom Line Basics
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