If own a Roth IRA, how soon can I withdraw my money? Robert 'Bob' Powell answers this question as part of Decoding Retirement's special segment, Ask Bob.

Powell was joined by award-winning author and retirement expert, Anne Lester, on the debut episode of Decoding Retirement to break down Roth IRAs and much more.

Question:

I first opened a Roth IRA in 2020. I have since put money in the Roth in 2021, 2022, and 2023. I understand you have to wait five years before you can begin withdrawal without any taxes, principal and gains. Based on this I can take out my 2020 money in 2025? Correct? When can I withdraw my 2021 money? 2025 also or is it five years from when money went into account? So, 2021 I can withdraw in 2026, 2022 in 2027 and so on? Or is all money available for withdrawal beginning in 2025?

Answer:

You can receive the earnings on all of your Roth IRA contributions tax-free once you satisfy a five-year holding period and you are over age 59 ½. The five-year period starts on January 1 of the year you first fund any Roth IRA. Since you opened your first Roth IRA in 2020, your five-year period ends on 12/31/24. So, all of your Roth funds are available tax-free starting in 2025. Since you’re over 59 ½, there also won’t be a penalty, according to Ian Berger, an IRA analyst with Ed Slott & Company.

Retirement planning doesn’t mean locking up your money for a rainy day and forgetting about it. Planning your future means reacting to events today. Decoding Retirement gives you the tools to navigate the years ahead, and take action now!

Yahoo Finance's Decoding Retirement is hosted by Robert Powell, and produced by Zach Faulds and Alexander Frangeskides.

Find more episodes of Decoding Retirement at http://goldberglawma.com/?id=videos/series/decoding-retirement.

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Editor's note: This post was written by Zach Faulds.