Age 59 and ½ - 401(k) Retirement Glossary & Terminologies

The significance of this age in retirement planning is that investors can begin taking distributions or withdrawals from their retirement accounts such as traditional IRAs, Roth IRAs and qualified 401(k) plans without facing any penalties. Any distributions or withdrawals taken before this age are considered ‘early withdrawals’ and will be penalized up to 10% unless a hardship existence is proven.
So you might ask, when exactly does a person turn 59 and ½ years old? Well the investor turns 59 and ½ years of age six calendar months after the 59th anniversary of the individual’s birth date.