Did you know you can use your 401(k) to retire early? Yep, it’s possible. And today’s guest, Eric Cooper, is doing it at age 47! Most FIRE chasers search for how to withdraw from a 401(k) early but know that doing so will hit them with substantial penalties. The best way around this? The 72(t) rule—which is precisely what Eric has been taking advantage of. Eric uses the 72(t) rule’s “substantially equal periodic payments” to take early withdrawals from his 401(k) of $30K per year, starting at age 47. But how does it work?
Eric comes on the show to describe exactly how this early withdrawal rule works, how much you can take out, the regulations to follow so you avoid penalties, and why early retirement may be much closer than you think. But this isn’t the only early retirement income Eric has got. We’ll review his substantial real estate portfolio and detail Eric’s almost unbelievable tax savings from combining tax-advantaged rental properties with rule 72(t).
Plus, Eric shares how he built a multimillion-dollar nest egg by his mid-forties and why those starting young on the path to early retirement can repeat his strategy to be much richer in retirement. Do you have money sitting in retirement accounts that you’re ready to use? The 72(t) rule might be just what you need.
Mindy:
The middle class trap is defined as being a millionaire with all of your wealth trapped in your 401k or your home equity. But what if you could access your retirement funds early? Today’s guest is going to show us just exactly how he did that without penalties. Hello? Hello, hello. My name is Mindy Jensen and with me as always is my still has his retirement funds in his retirement accounts Co-host Scott Trench.
Scott:
Well, with a setup like that, I’m going to withdraw from this podcast early. Mindy BiggerPockets has the goal of creating 1 million millionaires. You’re in the right place if you want to get your financial house in order because we truly believe that…