Isn there a tax penalty for early withdrawals from the Tax-deferred Account?
Once you establish and start an early withdrawal plan before the age of 59 1/2 you must withdraw the same amount (no more, no less) for 5 years. However, the way to add some flexibility to this is to establish multiple IRA’s as the calculation is only applicable on an IRA-by-IRA basis. ORP does not fix the amount of early withdrawals, but allows it to rise with inflation. This is a model simplification that will contribute an inaccuracy to the model’s results.
