When is it Safe to Withdrawal from an IRA Account?

With traditional and Roth IRAs (Individual Retirement Accounts), you have to be at least 59 1/2 years old to make a withdrawal without a penalty. Although most people cringe at the thought of withdrawing money from an IRA early, there are certain circumstances where it is permissible to avoid the 10% penalty. This certainly won't help with your retirement but when life throws a curve ball, the government does offer some exemptions:

• When the withdrawal is made for the purpose of paying college expenses for you or certain family members.
• When the withdrawal is used for paying medical expenses exceeding 7.5% of your adjusted gross income.
• When you are buying a first-time home an allowance of up to $10,000 from an IRA can be used for this purpose.
• When you find yourself with a sudden major disability.

Note that tax laws change all the time and I am no expert in this field. Always check with a qualified financial assistant or your accountant before touching an IRA.