Hello everybody, earlier than you panic, no I don’t wish to dip into my retirement financial savings to purchase a home. I understand how silly that will be (I’ve a 401K that’s my foremost retirement account). I opened a Roth IRA final 12 months and instantly put 7000 in it, from what I’ve learn, since you’ll be able to withdraw your contributions at any time after 5 years (4 for me now) and you may withdraw as much as 10K of the earnings tax and penalty free for a primary time residence buy, it looks like the proper account to make use of as a home financial savings account. So in my case, let’s say I contribute 7000 a 12 months for the following 4 years, I’d then have 35k of contributions plus no matter good points that funding makes within the meantime to withdraw (as much as 10k) to purchase a home. This appears a lot better than utilizing my common taxable brokerage account to save lots of for a home because it doesn’t have the tax advantage of withdrawing for first time residence shopping for. Am I lacking one thing right here? Once more, I’ve my retirement squared away, this could not have an effect on that a part of my financials. So my query is, is utilizing a Roth IRA purely as a brief time period financial savings account to make use of to purchase a home a wise technique?
