No. of Recommendations: 0
I know, I know. It is universally accepted that taking a 401k is a bad idea. But I am still seeking input from the board. My wife & I have aggressively saved for retirement and now have $1.5 M in our retirement accounts. We are 50 and would likely consider ourselves financially independent when accounts hit $3 M ($120,000/year using 4% withdrawal rate), in 8-10 years by mirroring Pro recs.

One "issue" in our financial life is the home equity loan we have that has a balance of just under $30k. We have ~$300k equity in the house (8 yrs left on a 15 year mortgage). Plus, my wonderful wife would like to do a $20k basement/backyard remodel.

One option would be to stop or drastically cut back on our 401k contributions for 12-18 months and use ALL of those contribution to pay off the home equity loan and perhaps pay for remodels in a staged approach.

Another option would be to take out the 401k loan of $30-35k to pay off equity line, and do one of the remodeling projects.

I feel very stable in my job (professor) as does my wife (physician) so the concern of having to paying off loan earlier than expected is minimal, but still a possibility.

What are your thoughts of those two options and what better options am I not thinking about. Thanks in advance for your input. I am typically a lurker on these boards, but this is a time that I would love some input from people smarter than me!

Tim
Print the post  

Announcements

The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement