[USER]

Would like to know which one to liquidate between 457 and Roth contribution. We need about $40k more for down payment. We have $58k in 457 from previous employer and $70k in roth contribution.

We have over $400k in different 401a, 401k, 403b accounts but only $100k in roth IRA including the above 70k contribution.

With early retirement plans, which one (457 vs Roth contribution) should we liquidate to cover the additional $40k down payment?

[Adam]

How much is the house? And why do you think you need to put more money down?

Where is your emergency fund right now?

What will you use to pay for home maintenance and renovations that aren’t tied up into retirement accounts?

[Scott]

It’s all about tax arbitrage ie is your income higher now or will your income be higher in the future.

Possibly if you plan to FIRE at an early age and your income is high this year while still working (and even higher with the pre-tax withdrawal) it would be cheaper in the long run to wait to pay the taxes on the 457 when you are in a lower bracket after you stop working.

If it is hard to judge…you could hedge and do 50/50 of each.

[Megan]

457s don’t have an age limit for withdrawing as long as your are not currently employed there.

[Dave]

You’re going to pay taxes on a 457 so depends on tax brackets and future plans

[Katherine]

1. Can you put less down? Shop loans for that feature, if needed. 2. If not, the Roth contributions can be withdrawn both tax and penalty free.

Depending on your tax bracket, this might be the best option.

[Author]

Posts