The Motley Fool Discussion Boards

Previous Page

Personal Finances / Credit Cards and Consumer Debt

URL:  http://boards.fool.com/any-interest-you-pay-in-is-added-to-your-balance-30948851.aspx

Subject:  Re: Thinking Of Borrowing??? Date:  10/30/2013  2:26 PM
Author:  MetroChick Number:  307440 of 308519

Any interest you pay in is added to your balance - you're paying yourself that interest, not a bank.

But you end up paying taxes twice on the money you're putting back into your 401K - you're repaying the 401K loan with after-tax dollars, and once you hit 59.5 and can withdraw, you pay taxes on money you withdraw from your 401K - so you end up paying taxes 2X on that portion of money you borrowed from the 401K.
Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us