Final answer:
The age at which you can start withdrawing money from retirement accounts depends on the type of account. For IRAs, you can start withdrawing money penalty-free at age 59½. With 401(k) plans, the age at which you can start withdrawing money varies depending on your employment status.
Step-by-step explanation:
Investment Retirement Accounts (IRAs) and 401(k)s are two common types of retirement plans that allow individuals to save for their retirement. While both plans have similarities, they also have some distinct features. When it comes to withdrawing money from these retirement accounts, the age at which you can start depends on the type of account.
For IRAs, you can start withdrawing money penalty-free at age 59½. However, if you withdraw money before this age, you may be subject to taxes and penalties. It's important to note that there are some exceptions for early withdrawals, such as using the money for qualified education expenses or first-time home purchases.
On the other hand, with 401(k) plans, the age at which you can start withdrawing money penalty-free depends on your employment status. If you are still working for the employer that sponsors your 401(k), you generally cannot withdraw money until you reach age 59½. However, there may be a provision in your plan that allows for early withdrawals at age 55 or later if you retire.