{ "media_type": "text", "post_content": "So let’s say I meet my FIRE number but all my money is in retirement accounts....how do I retire early? By early I mean like late 30s early 40s. Wouldn’t I pay a penalty?", "post_id": "6089adb4b098d1002a048dd1", "reply_count": 9, "vote_count": 3, "bowl_id": "5b3f7377ab53db00136f7b4c", "bowl_name": "FIRE Financial Independence Retire Early" }

So let’s say I meet my FIRE number but all my money is in retirement accounts....how do I retire early? By early I mean like late 30s early 40s. Wouldn’t I pay a penalty?

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Google a Roth conversion ladder. Basically you start converting yearly expenses from traditional to Roth starting 5 years before you plan to retire. That will give you access to funds penalty free before you hit 59.5

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Don't start conversion till you're retired, otherwise your marginal tax rate will wreck havoc! Have enough in your bank accounts and taxable brokerage for the first 5 years in retirement. Start the Roth conversion as soon as you retire.

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72(t) is just equal distributions over time and avoids penalty, right? Is there a set % you have to apply?

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There are several for podcasts about this. It's a bit dated but radical personal finance from 11/17/14 titled How to Get Money Out of Your Retirement Accounts Before 59.5 for Early Retirement RPF0104

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