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Can I use a Roth IRA like a savings account?

by Lois
(Wilmington, NC)

I heard about a Roth IRA a lot but I don’t know how it works exactly. What happen if I take out some money from it? After I use it, can I put it back to the account later?

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Can I use a Roth IRA like a savings account?

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by: Ed

First of all, accessing the retirement accounts is not good idea because you can’t put it back again once you withdraw money from the Roth IRA account.

A Roth IRA account is designed to save for your Retirement. That’s why it gives you many tax advantages. If you use a Roth IRA like a savings account, you may lose the tax benefits and pay some penalties.

Most of all, you will lose asset accumulation opportunities achievable with long-term investment.

The good news is that Roth IRA rules allow you to withdraw principle contributions without any penalty at anytime. Therefore, you can use Roth money in case of real emergencies.

Reference: Roth IRA Withdrawal Rules

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