re: Early Retirement

I make 39 this year and I believe the only thing that will keep me from retiring early is health care. According to the government retirement age for me is 67. I sit at a desk for most of the day so my job isn't that damn demanding physically. One or two major health care scares and my retirement funds can vanish very quickly.

My dad is retiring this month after being an Operator for almost 30 years. He's 62 now and his health care premiums cost $1500 per month for both he and my mom who is also a retired school teacher. He can't get Medicare until he's 65. So for three years he will have to manage those high arse premiums. Hopefully, he won't have any major health issues during that time.

The laddering info was something I was ignorant of. Good stuff.

quote:

---

To access the money in the retirement accounts prior to standard retirement age without paying any penalties on the distributions, he can create something called a Roth IRA conversion ladder.

Thanks to the way Traditional IRA to Roth IRA conversions work, you are able to withdraw converted money five years after the conversion date, tax and penalty free. So in this example, assume that he converts his entire 401(k) to a Traditional IRA when he achieves FI and then, every year after that, he moves $9,750 from his Traditional IRA into his Roth IRA. He would only need to do this for five years before he could then start withdrawing $9,750 per year, tax and penalty free!

---