Yes, but some funds have deferred sales charges, but it is still your money.
2006-11-16 12:11:51
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answer #1
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answered by Nelson_DeVon 7
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If you put money into a "tax-deferred" fund, and you take it out before 59-and-a-half, you will lose as much as 60% of it to taxes and penalties in most cases, ie if there is $10,000 in there, you will only get a check for about $4,000 and the taxman will get the rest. It is your money, so they cannot prohibit you from withdrawing it, but it would be a dumb thing to do. Think about it, using the example above, you could borrow $4000 at an interest rate so high that you ended up paying $8000 back, and still end up ahead of where you'd be taking the funds out of your retirement account. The tax law is constructed this way precisely because the point is to discourage you from using that money for something trivial. If you are, say, 20 years old, and you leave $10,000 in there until you retire at 60, you may well have over a million dollars. (This is assuming you start with $10,000 in stocks, add nothing, and the market continues its average 7-10% yearly return, effectively doubling your money every seven years or so.) The government want you to be wealthy when you are old so they don't have to look after you!
Don't do it, it's just stupid. And I can promise you that if you do do it, when you are 60 you'll work out exactly how much money you could have had, and it will thoroughly depress you!
2006-11-16 13:30:52
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answer #2
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answered by Anonymous
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No.
Keep in mind that there may be 2 sets of rules and penalties:
1. IRS regulations
2. Financial product rules
For instance, the IRS has pretty strict rules for anybody wanting to pull money from their retirement accounts prior to age 59.5 (10% penalty).
In addition, the financial product might have some surrender fees if you break the contract (i.e.: a person with a 5 year CD is asked to leave their money on deposit for 5 full years).
A person making a withdrawal needs to be mindful of both types of penalties.
2006-11-18 00:22:45
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answer #3
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answered by derek 4
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There are usually penalities if you withdraw early. I hear that if you open a Roth IRA, you can withdraw early with no penalty.
2006-11-16 12:19:17
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answer #4
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answered by aznbrik 2
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Yes, you may take a partial or total disbursement. However, watch out for the penalty and taxes.
2006-11-16 12:09:17
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answer #5
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answered by maggiepirsq 4
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you can withdraw it but the taxes and fees might take a big chunk
2006-11-16 12:10:56
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answer #6
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answered by John M 1
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Read the small print of the agreement. Every one is different.
2006-11-16 12:08:28
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answer #7
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answered by love2travel 7
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