Your retirement fund: Smart ways to withdraw
Last year I reached a milestone age: 59½, old enough to withdraw money from my individual retirement accounts with no penalty. While this felt bittersweet, it did remind me of the importance of timing when it comes to taking money out of retirement accounts. Withdrawing at the wrong time can create serious tax consequences.
The basic concept of retirement accounts such as IRAs and 401(k)s: While you work, you put money in; when you retire, you take money out. For maximum benefit from your retirement income, though, you need a withdrawal strategy.
The standard approach to withdrawing retirement funds usually follows this progression: