Can I take contributions out of traditional or roth 401(k) before 59 1/2 without penalty?

Question

Can I take contributions out of a traditional or roth 401(k) before 59 1/2 without penalty?

I'm basically looking for this table and cannot find it anywhere, please let me know if any of the below is incorrect:

---------	Traditional 401k	Roth 401K	Traditional IRA	Roth IRA
Withdrawing Contributions before 59.5 yrs:	No, penalty applies	No, penalty applies. Only earnings are penalized but contribution & earnings are lumped together here. Solution: Roll over into Roth IRA	No, penalty applies	Yes no penalty. Must wait 5 yrs if conversion.
Withdrawing Earnings before 59.5 yrs:	No, penalty applies	No, penalty applies	No, penalty applies	No, penalty applies
Withdrawing Contributions after 59.5 yrs:	Yes no penalty, taxes apply	Yes no penalty	Yes no penalty, taxes apply	Yes no penalty
Withdrawing Earnings after 59.5 yrs:	Yes no penalty, taxes apply	Yes no penalty	Yes no penalty, taxes apply	Yes no penalty if account has been open for 5+ years
Income Limits (2024)	None	None	None	$161,000

Answer 1

No, you cannot take contributions out of traditional 401(k) or IRA accounts without penalty. Since it's a pre-tax account, allowing you doing that would let you shift taxes from years of high income to years of low income. The tax deferral is only allowed without penalty if used in retirement (or, more specifically, after the age of 59 1/2).

The reason you can take out contributions without penalty from after tax and Roth accounts is that you've already paid taxes on the money when you earned it and nothing was deferred.

There are specific uses for which you can take distributions without penalty (taxes apply), for example first home purchase. The IRS actually has a nice table here.

Answer 2

Some plans will let you borrow money out of your retirement account. But that turns out not to be as attractive as it sounds; the cost is the tax-free growth that money would have returned over that period if left in the retirement account, which often works out to being more than you would have paid if you just got a bank loan. Run all the numbers rather than being distracted by the concept of "paying interest to yourself"; think of borrowing elsewhere as a possible leverage opportunity. Hold this option in reserve for emergencies.