My wife and I are in our early 60s. If we put money into a Roth IRA, do we still have to wait 5 years before withdrawing it? If one withdraws the account before 5 years, what are the penalties?
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You can withdraw your contributions at any time; only any money you’ve earned on those contributions is subject to the five-year rule. In other words, if you contribute $5,000 this year and it grows to $5,100 next year, you can withdraw $5,000 without penalty. The $100 in earnings would be subject to a 10% penalty.