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I'm dealing with the same issue right now.

You can avoid the penalty by "annuitizing" the withdrawals based on life expectancy; that is, if at age 50 you have 32 years left according to life expectancy tables, then you have to remove 1/32 of the balance each year.

The amount adjusts periodically and I think you can stop making those withdrawals after five years or until you're 59 1/2, whichever is longer. (And at that point, you could take out as little or as much as you want until you have to start taking some out at 70 1/2.) So if your retirement accounts are robust enough to take repeated distributions from age 50 to 59, it's certainly feasible.

Remember that your employer's retirement benefits are unlikely to kick in until age 55 at the earliest, so you need to factor that into your cost of living at least between the ages of 50 and 54.

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