Is there a penalty for withdrawing from my Traditional IRA before I retire?

The purpose of an IRA is to save for retirement, so this tax-advantaged savings vehicle is specifically designed to discourage investors from withdrawing funds before turning age 59½. If you do so, the IRS imposes a 10 percent penalty on top of the income taxes you pay on the withdrawal. There are some exceptions that allow early withdrawal without penalty, so please speak with an Alliant representative for more details.