Question by  DylanF (93)

What are the pros and cons of cashing out an IRA?

I need to make the decision soon.


Answer by  DavidS (1517)

The positive is you will receive a lump sum of money. The cons of doing this are the penalties especially if you withdrawing money before retirement age the penalties are high. Another con is taking money out of an IRA will greatly reduce long term gain for future retirement.


Answer by  Cecilia (2828)

There are no pros of cashing out your IRA. There are many cons, including the 10% penalty if you're under 59 1/2 and the fact that the money becomes income in the year you receive it. This may nudge you into a highter tax bracket. Then there's the fact that the money will be gone before you retire.

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