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Hello, my wife and I each have a Roth IRA (opened last year). We each contributed $500 last year to our respective IRAs, and would now like to max out our contribution for '98 (each add $1500 more).

A couple questions though.

We have a 'rainy day' fund in case one of us loses our job, etc... This is the fund from which we would be transferring money to the Roth IRA. I am a strong believer in having cash available in case we need it. I have heard that it is permissible to withdraw principal from a Roth IRA, but not growth. Is this true? Is this a trivial thing to do? We have our Roth IRAs at Schwab; could we simply transfer principal from our Roth back into our main Schwab account if need be?

If we do withdraw principal are we later allowed to re-deposit that same principal?

I.e. we save $2000 for each of 1998 and 1999. In 2000 We withdraw all $4000 because one of us loses our jobs. Later in 2000, could we redeposit all $4000, or only the $2000 yearly maximum?

Thanks for any help,

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