Early retirement and CARES Act rules

The CFPB has posted an article with information for those considering an early retirement withdrawal from their retirement savings. Normally, if individuals withdraw money from traditional Individual Retirement Accounts (IRA) and employer-provided accounts before reaching age 59½, they have to pay a 10 percent early withdrawal penalty to the IRS. Furthermore, withdrawals from current employer-provided plans are limited to an amount needed to meet a limited set of approved hardships, like avoiding foreclosure, home repairs after a disaster, or medical expenses. However, for hardships resulting from the pandemic, temporary changes to the rules under the CARES Act may provide more flexibility to make a withdrawal from tax-deferred retirement accounts during 2020.