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Support for rule of 55 modeling in USA

Add support for Rule of 55 modeling which allows for penalty-free withdrawals from a 401(k) and 403(b) if you leave a job during or after the calendar year you turn age 55. This is an exception to the IRS rule that levies a 10% penalty on withdrawals from employer-sponsored retirement plans before age 59.5

Currently this conflicts with the (singular) 10% early withdrawal penalty at 59.5/60.

I either have to change the early withdrawal penalty age to 55 to hack it in to model leaving a job at 55 and get the drawdown to properly allow for withdrawals from certain employer-sponsored plans.

2 votes

Tagged as Suggestion

Suggested 16 January by user omega7419

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  • 16 January omega7419 suggested this task

  • 16 January Kyle Nolan approved this task

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    These are the 401k/403b settings I’m using to model Rule of 55. This seems to work well.

    Allow withdrawals: After qualified withdrawal age Display account as liquid: After qualified withdrawal age Has early withdrawal penalties: Checked Qualified withdrawal age: 55 Penalty rate: 10.00%

    04 April