Message Font: Serif | Sans-Serif
No. of Recommendations: 0
My wife and I (28 and 30, respectively) will be needing some extra money in the next 4-6 months to help with medical bills. It is possible that these bills could run as high as $10-15k.

At this point, we are slowly rebuilding our emergency savings (<$2000) and our personal stock portfolio is rather meek as well (~$5000) - although we are making regular contributions. However, on the plus side, we have no debt - other than our 2 cars and house.

My wife works part-time, but I have a fairly decent job. I have saved $40k in my 401k and I'm fully vested.

Based on this, I feel like our best situation is to get a loan from my 401k to help with the medical bills. I am being told I have ~$20k available in my 401k for a loan at an interest rate of 5.75%.

It's obvious I don't have money readily available to pay for these bills and the rate on the loan appears to be as low as I can get.

However, I'm not exactly sure how the "401k loan" process works. Please provide any insight on this and whether doing this is my best option.


Print the post  


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.
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.