2007-11-05 08:28:58 · 11 answers · asked by Brian S 2 in Business & Finance ➔ Personal Finance
not without heavy financial penalty
2007-11-05 08:31:33 · answer #1 · answered by Anonymous · 0⤊ 3⤋
A Roth IRA must be invested from earned income but it’s not a good idea to borrow money to invest anyway, especially in stocks for short term gains (less than 5 years). What if your investment goes down? The high yield savings account is a very bad idea as well, even at 5% which is about the best interest rate you will get. The reason being is that you have to make at least 6% interest annually to keep up with inflation and taxes alone. So using this strategy you will actually be loosing 1% per year.
2016-04-02 06:59:08 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Generally, ROTH IRAs have two parts: Contributions and Earnings.
You can always withdraw the contributions tax and penalty free. If you withdraw the earnings, you will have to pay ordinary income tax plus a 10% penalty. The penalty can be avoided if you have a qualifying exception. Unforunately, paying a student loan is not an exception.
2007-11-05 09:22:09 · answer #3 · answered by Wayne Z 7 · 2⤊ 0⤋
A Roth IRA is different than a traditional. You can take out any of the contributions made to it at any time without any penalty since this is after tax money. However, you will be penalized on any of the earnings. For example, if you made a lump sum contribution of $10k and the account has grown to 20K you may take out the original 10K out without paying taxes or a penalty. If you take out 20k the remaining 10k will be taxed and have a 10% early withdrawal penalty added to it. I hope this helps.
2007-11-05 09:23:33 · answer #4 · answered by scottsmylie 5 · 2⤊ 0⤋
Probably not. I think the issue of withdrawing from an IRA (traditional or ROTH) to pay for school is for your initial enrollment. But, check with the IRS to make sure. www.irs.gov or 1-800-829-1040
2007-11-05 08:31:52 · answer #5 · answered by Phurface 6 · 0⤊ 3⤋
Yes, but you will suffer taxes on the interest that may be heavier than the interest you're paying on the student loan. Consult your financial advisor.
2007-11-05 08:32:14 · answer #6 · answered by ima_super_geek 4 · 0⤊ 3⤋
You can always withdraw your original contribution without penalty...I hope that Helps a little
2007-11-05 08:31:04 · answer #7 · answered by loudwalker 2 · 2⤊ 2⤋
You are able to borrow up to $1,000 of your IRA without penalty if you pay it back with in a year...
2007-11-05 08:31:52 · answer #8 · answered by It's a girl due 5/11/09 4 · 0⤊ 4⤋
If it is allowed then there is usually a penalty
2007-11-05 08:31:56 · answer #9 · answered by sego lily 7 · 1⤊ 2⤋
you pay a tax penalty I believe
2007-11-05 08:31:22 · answer #10 · answered by Anonymous · 0⤊ 3⤋