real estate

Tapping a Roth IRA for a House

You can withdraw contributions from a Roth IRA to help purchase your first home.

Question:

I am 28 and want to buy my first home. I’ve had a Roth IRA for four years. Can I withdraw money from the Roth for a down payment without penalty or taxes?

Answer: You can withdraw contributions from a Roth IRA at any time without taxes or penalties, and your first withdrawals are considered to be from contributions. After that, you can withdraw up to $10,000 in earnings from your Roth for a first-time home purchase without penalty, but you’ll have to pay taxes on the earnings unless you’ve had a Roth IRA for at least five years.

Most Popular

Dying Careers You May Want to Steer Clear Of
careers

Dying Careers You May Want to Steer Clear Of

It’s tough to change, but your job could depend on it. Be flexible in your career goals – and talk with your kids about their own aspirations, because…
September 13, 2021
5 Top Dividend Aristocrats to Beef Up Your Portfolio
dividend stocks

5 Top Dividend Aristocrats to Beef Up Your Portfolio

The 65-member Dividend Aristocrats are among the market's best sources of reliable, predictable income. But these five stand out as truly elite.
September 14, 2021
7 Best Commodity Stocks to Play the Coming Boom
commodities

7 Best Commodity Stocks to Play the Coming Boom

These seven commodity stocks are poised to take advantage of a unique confluence of events. Just mind the volatility.
September 8, 2021

Recommended

11 Best Things to Keep in a Safe Deposit Box
savings

11 Best Things to Keep in a Safe Deposit Box

These valuables and documents, along with some items you hold dear, should be stored securely at your bank.
September 25, 2021
Tax Changes and Key Amounts for the 2021 Tax Year
tax law

Tax Changes and Key Amounts for the 2021 Tax Year

Americans are facing a long list of tax changes for the 2021 tax year. Smart taxpayers will start planning for them now.
September 23, 2021
After Surfside Collapse, 6 Crucial Steps Every Condo Board Should Take Today
real estate

After Surfside Collapse, 6 Crucial Steps Every Condo Board Should Take Today

If you manage a high-rise condo, you have got to be on the ball, because lives could be at stake. To protect your residents (and yourself, as a fiduci…
September 6, 2021
When and Why You Might Consider a Strategic Roth Conversion
Roth IRA Conversions

When and Why You Might Consider a Strategic Roth Conversion

For two of my clients, the time was right for executing a Roth IRA conversion. Here’s why, and how they made the strategy work for them.
August 30, 2021