If you're not sure about when to retire, you're not alone. Uncle Sam seems to be just as confused. Consider the fact that normal retirement age according to Social Security Administration ranges from age 65 to 67. The younger you are, the longer it'll take to get there. But you don't have to wait until the "normal" retirement age to stop fighting rush-hour traffic. You can quit work and start to collect Social Security retirement benefits at age 62. But if you start then, or any time before the normal age, your monthly checks will be smaller. Many people want to retire before age 62—even as early as age 55. If you're among them, more than likely you'll need to tap a retirement account such as your IRA or 401(k) to cover your living expenses. The catch? "If you draw down your retirement account before age 59-1/2, you may owe a 10% penalty," says Mark Cortazzo, senior partner at MACRO Consulting Group, a financial planning firm in Parsippany, New Jersey. Say you pull $20,000 from your IRA when you're 57. Not only will you owe income tax on that $20,000, you'll owe a $2,000 surtax (10% of $20,000) as well. There isn't anything you can do about paying income tax if the money in your IRA or 401(k) has never been taxed. But there are a couple of ways to dodge the 10% penalty. For starters: 1. Stay on the job until age 55. "The tax code provides penalty-free access to the money in your company's retirement plan as early as the year you reach age 55 in case of ‘separation from service' that year or later," says Natalie Choate, an attorney with Nutter McClennen & Fish in Boston. Therefore, if you retire at age 55 or later and leave your money in your former employer's 401(k) plan, you can take withdrawals and escape the 10% surtax. 2. Take "substantially equal periodic payments." The age-55 exception won't help everybody. Your company may not allow former employees to stay in its 401(k) and take withdrawals. Even if it does, you may not want to keep your money there, limited as it would be to the plan's investment choices. What's more, this exception applies only to money at the company you left at or after age 55. "Money you might have in IRAs or other company plans won't qualify," says Choate, author of Life and Death Planning for Retirement Benefits (Ataxplan Publications; $89.95). Perhaps most important, this exception won't help if you want to retire before age 55. At any age, as long as you're retired, you can avoid the 10% surtax on any or all of your retirement accounts with a "series of substantially equal periodic payments," according to Choate, or what she calls SOSEPP. In essence, you take an annuity based on your life expectancy. If you start the withdrawals at age 48, for example, you would use your official 36-year life expectancy to calculate how much you can take out, penalty-free. Five years or 59-1/2. Suppose, for example, John Smith retires at age 48 and wants to tap his IRA without paying a penalty. He does not have to start by taking out 1/36 of his account in year one and gradually draw down the entire account over 36 years. Instead, he can keep up his SOSEPP for five years or until age 59 1/2, whichever comes later. John starts his withdrawals at age 48, so he must continue until 59-1/2. If Tracy James starts at age 56, she must continue until at least age 61. Once you're past both the five-year and age-59-1/2 hurdles, you can take out as much or as little as you'd like, without paying a penalty. More or less. The SEPP rules permit you to decide among various methods, which result in different distribution amounts. Minimum distribution amounts. You may want to take a relatively small amount from your IRA or 401(k), leaving as much as possible in the account to support a long retirement. In that case, you might take 1/36 of the account in year one, if you have a 36-year life expectancy, about 1/35 of the account in year two, etc. Maximum distribution amounts. The Internal Revenue Service permits you to use an "amortization" method instead. In essence, you project how large your retirement account will grow over the years and take your SOSEPP based on that projected appreciation. Depending on your age and on the level of interest rates in effect at the time you start a SOSEPP, you might be able to take two or even three times as much from your retirement account, penalty-free, as you could with the minimum distribution method. (The IRS also permits an "annuitization" method, but it's seldom used.) Using recent interest rates, for example, a 50-year-old using the minimum distribution method would be able to withdraw nearly $11,000 a year from a $500,000 IRA, without owing a 10% penalty. With amortization, he could take out $23,000 or so, penalty-free. Your accountant or financial adviser should be able to walk you through the calculations so you can choose the appropriate method for SOSEPP withdrawals. Be careful, though. "Contributing just $1 to an account that has begun these distributions could trigger retroactive penalties plus interest," says Cortazzo. Withdrawing more or less than the permitted amount can also trigger penalties. Therefore, you should be confident that you'll maintain your SOSEPP precisely until you pass both five years and age 59-1/2.