DaemonTargaryen2024 t1_iuio6wp wrote on October 31, 2022 at 4:55 PM

Yes without tax or penalty because your contributions were $2,100.

>Can I withdraw the full $2,027 without penalty?

Dividends are meaningless for this conversation. Roth contributions are tax and penalty free, anything above the contributions are the earnings which are taxed and penalized until reaching 59.5.

>Roth has earned ~127 in dividends since inception.
>
>Can I withdraw the full $2,027 without penalty? Or would I only be able to withdraw $1,900 ($2,027 - $127)?

I would generally recommend against using a retirement account to pay for current expenses. This will be tax/penalty free but it sets a bad precedent and also handicaps your future retirement security.

Also recommend against even thinking about what and how you'll invest, until you sort out your debt, spending, and budget. Use the wiki and prime directive here to get a handle on budgeting 101, that should be your priority at the moment.

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punkfreak75 OP t1_iuir62x wrote on October 31, 2022 at 5:15 PM

Thank you!

You answered my question clearly. It makes sense that earnings are anything above contributions. I was mostly unsure about whether I would have to take in dividends into the calculation of the current depreciated value, but as you stated, that is not the case.

And I agree, it is generally recommended against using a retirement account to pay for current expenses. However, I am funding, above the match, my 401k and will increase that as my income increases. I get bi-annual raises and will be earning my professional certification in the next year which will greatly increase my earning potential.

Lastly, is my above budget not appropriate? I know most here would say they would cut subscriptions as they are luxuries, but these are gym, strava, and hulu, my only luxuries that keep me content and healthy.

DaemonTargaryen2024 t1_iuis6ss wrote on October 31, 2022 at 5:22 PM

Yup spot on about the Roth, dividends not a factor either way really.

I mention budget because of the CC debt and your saying you made poor financial lifestyle decisions. If you've worked through those already then you should be good.