Why IRS Rule 72(t) Isn’t a Shortcut but a Lifeline for Early Retirees

Written By Patrick Thompson

Here's what you need to know:

• Rule 72(t) lets you take early IRA or 401(k) withdrawals penalty-free if you commit to a specific payment schedule (SEPP).

• It’s not a loophole for quick cash—once you start, the commitment lasts at least five years or until you turn 59½.

• Ideal for high-earning professionals, executives, and small business owners seeking flexibility before traditional retirement age.

Understand the pros, risks, and whether this long-term strategy fits your unique financial plan.

Patrick Thompson
Next

How does starting a side hustle as a teenager create long-lasting independence?