Running out of money in retirement is pretty much a universal fear, so the longer you hold off on withdrawing funds from your nest egg, the longer it's likely to last. Still, if you're housing your savings in a traditional IRA or 401(k), you're allowed to take distributions beginning at age 59-1/2 without having to worry about penalties. And if you're saving in a Roth account, you can technically withdraw your principal contributions at any time.

Now, maybe you think you're ready to start accessing some of the cash you've been accruing all these years. But before you dip in, ask yourself these questions first.

Senior couple reviewing documents

Image source: Getty Images.

1. Am I actually retired?

The purpose of an IRA or 401(k) is to provide income for you during retirement. Therefore, the biggest question you should ask yourself before taking a withdrawal is whether you're using that money for its intended purpose. Tempting as it may be to take a withdrawal at age 60 to go on a luxury vacation or cover the cost of a major home improvement, any amount you remove from your nest egg while you're still working won't be available later on. And that's why it's generally best to avoid touching your savings until you're actually retired and are no longer collecting a paycheck.

2. Do I have other income sources I can access first?

The more money you have sitting in your nest egg, the more growth you'll have the potential to generate. That's why it often pays to access other sources of income before beginning to deplete your nest egg.

Imagine you retire at 65 and take a $20,000 withdrawal your first year to pay for expenses. That $20,000 will no longer continue generating returns. However, if you have $20,000 sitting in cash that you don't need, you're better using that money first before touching your nest egg, assuming that $20,000 isn't part of your emergency fund.

3. Do I really need the money in the first place?

Some people take the attitude that once they're entitled to penalty-free withdrawals from their retirement savings, they might as well remove that cash. But before you take that distribution, think about whether you actually need the money or whether you can get by without it. Sure, maybe it would be nice to go on three vacations this year instead of one or two, but if doing so results in a major nest egg withdrawal, you could end up limiting your income stream for life and increasing your chances of depleting your nest egg prematurely.

Of course, this isn't to say that you shouldn't access your savings to pay for leisure in retirement. After all, you worked hard to put that money away and deserve to enjoy your golden years. Rather, just understand the consequences of removing funds from your IRA or 401(k), especially if your savings aren't great, and make sure it's the right thing to do.

But don't wait too long to access your retirement savings

While it's smart to be judicious about tapping your nest egg, you don't want to wait too long to access your money, either. Once you turn 70 1/2, you'll be on the hook for required minimum distributions (RMDs) unless your savings are housed in a Roth IRA. The precise amount of your RMDs will depend on your savings balance and life expectancy at the time, but if you neglect to take them in full, you'll be hit with a whopping 50% penalty on any amount you neglect to withdraw. Therefore, while it pays to hold off on raiding your nest egg for as long as possible, don't make the mistake of going to the opposite extreme and losing out on a portion of the money you've worked hard to save.

The Motley Fool has a disclosure policy.