Quote:
Originally Posted by Russ_Boston
To the best of my knowledge (I have done some research):
A tax deferred investment (401k, traditional IRA) you can start withdrawals at 59.5 y.o. Yes you will declare this as income at tax time. They will withhold 20% at withdrawl time and give you a statement at year end. The previous statements are true regardless of current income situation. There are actually ways to take a withdrawal prior to 59.5 without the 10% penalty but I won't get into that since you didn't indicate that.
As to pension - Most likely you will earn that pension when you earn it. In other words it won't matter if you work another job. If your plan says you get paid at 59.5 then you will get paid. They will withhold taxes in the same manner as if you were still being paid by them (i.e. it might be more or less depending on claimed allowances etc. It's not auto 20% like a 401k).
If you have a ROTH IRA then the withdrawal is tax free since there was no income tax advantage when you put it in. Again this age is 59.5.
Social security (if you take early at 62) is obviously reduced and then reduced again if you have current income from employment. You should refer to the SS web site for a calculator if interested.
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Russ Boston godd summary. I would only add that the tax implications should be explored as well as the drawbacks at such an early age.
for example I have an aftertax mutual fund. I took my *****on from my second employer as a lump sum and reinvested. I then took monthly payments from this mutual fund until the market started to tank. I suspended the payments and allowed the fund to build again. Had i kept drawing on it I would have depleted it too quickly....just saying