Tapping retirement savings early triggers tax plus a penalty. See what you'd actually keep.
An early withdrawal calculator shows the tax and penalty on tapping a retirement account before age 59½, so you can see how little of the withdrawal you actually keep.
Withdrawing from a traditional retirement account before 59½ usually triggers two costs: ordinary income tax on the amount, plus a 10% early-withdrawal penalty. Together they can take a third or more of the withdrawal, so a $25,000 early withdrawal might net far less. This is on top of losing the future tax-deferred growth those dollars would have earned.
Because early withdrawals are so costly, they're usually a last resort. Some exceptions waive the penalty, certain medical costs, a first home (IRAs), higher education, or a series of substantially equal payments (72(t)). A 401(k) loan or other borrowing is often cheaper than a taxable, penalized withdrawal. This estimate excludes state tax and isn't advice.
Generally a 10% penalty plus ordinary income tax on the amount, for withdrawals before age 59½ from a traditional account. Some exceptions apply.
Yes, certain medical costs, a first home (IRAs), higher education, disability, and 72(t) equal payments can waive the 10% penalty.
Rarely, given the tax, penalty, and lost growth. A 401(k) loan or other borrowing is often cheaper. Treat it as a last resort.
See the exact formula and a worked example on our methodology page.