Happy New Year 2018 wishes to all of you out there. May this year be your year to shine in all aspects of your life.
While you continue to earn, save and invest, please keep in mind that health is wealth. Don’t ignore your health and relationships in pursuit of wealth. At the same time, don’t ignore saving and investing in pursuit of short term pleasures and gains. Finding a balance is the key.
If you haven’t started saving yet, I encourage you to start this year. Start with saving as little as a $1 a day and you’ll be surprised how easily it adds up. Add more to it whenever you can, add less when you cannot.
Have a great year!
Typically, the IRS will impose a 10% IRA early distribution penalty on any taxable amount in your IRA, if you withdraw money from it before the age of 59½. Fortunately, there are various exceptions to this rule under which the penalty may be waived. Here’s a list of the exceptions.
- Medical Expenses – If you have medical expenses that will not be reimbursed or if you are unemployed and need the money to pay for your medical insurance.
- Disability – If you are unable to work due to a mental or physical disability.
- Education – If you need to pay for expenses for higher education for you or your family.
- Inheritance – If you are the beneficiary of an IRA of a deceased person, the amount you withdraw from the inherited IRA is penalty free.
- Home Purchase – If you are purchasing your first home.
- Equal Payments – If you need money from the IRA for a few years and are willing to withdraw the same amount at a specified interval until age 59½ or for 5 years, whichever comes later.
- IRS Levy – If you need to withdraw money as a result of an IRS levy.
- Military – If you are called to active duty.
For more details regarding these items, you can refer to information provided by the IRS at the links below: