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beccapooka writes (in part):

I think I am understanding that as a retirement acct the ROTH wouldn't hurt my financial aid package, and the money held in a ROTH for 5 years isn't subject to taxes or penalties. In that case, if needed, I could withdraw from my ROTH to repay my loans if needed, right?

I eply:

Not exactly. Contributions can be withdrawn without taxes or penalties whenever you'd like. Earnings must be "qualified" to avoid taxes. To be qualified (if memory serves), the account must have been open for at least five years, and you must be at least 59.5 years of age. The good news is that by definition, your first withdrawal from a Roth is deemed to be your contributions, until they are all used up.

Again if memory serves, you can withdraw earnings from a Roth to pay educational expenses without penalty. You'll still pay ordinary income taxes on earnings withdrawn for this purpose, though. If the withdrawal weren't for an authorized purpose, premature withdrawal of earnings also would be subject to a 10% penalty. --Bob
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