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Although I recognize that taxes are a part of life, I typically try to do my best to pay as little of them as possible. To that end, I make a point to max out my 401(k) every year. And I also try to max out the HSA my family became eligible for a few years ago when our health insurance plan changed.

But even though I love the tax breaks that come with IRAs and 401(k)s, I’m keeping a pretty large chunk of my retirement nest egg outside of these accounts and in a regular brokerage account with no tax benefits instead. Here’s why.

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I need to have options

The idea of early retirement appeals to a lot of people I know, but it certainly doesn’t appeal to me. I can’t imagine myself wanting to stop working any sooner than I have to. In fact, a big part of me never wants to retire at all.

But while I know that early retirement isn’t part of my plan right now, things have the potential to change. I might change my mind, or circumstances might force me out of a job (I’m talking to you, AI).

In fact, last year, a report by financial firm Edward Jones found that 40% of advisors had clients who were forced to retire before they were ready to. That’s a pretty scary percentage.

That’s why I’m making a point to keep some of my savings outside of an IRA or 401(k) plan. If you tap one of these accounts before turning 59 1/2, your withdrawals are subject to a 10% penalty. That’s not money I’m willing to give up. And while I’d like to think I won’t retire before 59 1/2, I can’t write off the possibility, either.

By keeping some of my nest egg in a regular brokerage account, what I’m doing is buying myself more options. And that extends beyond retirement.

I have three kids I’d like to put through college. I’m saving for their education separately, and yes, I’m putting my retirement first. But if I end up a little short on tuition, I have the option to take a withdrawal from my brokerage account to cover the difference if I feel that’s something I can afford to do.

Granted, IRAs let you take penalty-free withdrawals for education, too. But I have my savings in a 401(k), and that option doesn’t exist there. So while my intent is to use the brokerage account portion of my savings for my retirement only, it’s nice to have that separate money as a backup option of sorts.

Give yourself some flexibility

You never know when you might have to retire sooner than planned. Or, you might end up with more savings than expected by your mid-50s to the point where you’re comfortable wrapping up your career.

In those situations, it’s important to have access to funds that aren’t restricted or subject to early withdrawal penalties. So I’d highly recommend keeping a portion of your retirement savings outside of an IRA or 401(k) like I do.

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