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>> I understand that the minimum age for penalty-free-withdrawls from these accounts is 59 1/2. Or is there any dispensation for early retirees? Do I need to start focusing more on my taxable account to make it from 53 to 59? <<

There are (mostly) three strategies for dealing with penalty-free withdrawals before age 59 1/2.

(1) If you terminate employment no earlier than the year you turn age 55, withdrawals from your most recent employer's 401(k) plan are penalty-free starting at age 55. Since you wish to retire at 53, this may not help you.

(2) Increase investments in taxable accounts. If you let a good stock, stock fund or ETF "ride" and pay taxes on only long-term capital gains and dividends (as long as they're still given preferred treatment), then you're only paying 15% on that portion. Plus you don't have to deal with penalties for withdrawals before 59 1/2. Even if you retire after 59 1/2, taxable accounts are useful because they help you (along with 401Ks, traditional IRAs and Roth IRAs) to "engineer" as much income as you can at lower tax rates.

(3) Take "substantially equal periodic payments" (SEPP) from a traditional IRA using Rule 72(t). If you do this starting at age 53, you would have to continue this until age 59 1/2 (or five years, whichever is greater, which for you at 53 would be 59 1/2).

There's actually a fourth option -- withdraw the *contributions* from a Roth IRA (while you can't get to earnings in a Roth without penalty until 59 1/2, you can always withdraw the contributions -- you've already paid taxes on them). Personally I'd consider that a less preferable option to the others because it takes away some tax-free compounding of your portfolio, but it is nevertheless another option to generate retirement income before age 59 1/2.

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