Skip to main content
Message Font: Serif | Sans-Serif
No. of Recommendations: 0
Can anyone tell me the positive and negative aspects about borrowing money from your 401k? A couple of employees at my work have enough money in their 401k's that they could take a loan out against the 401k and payoff their home mortgage. The interest that was being paid to the bank now gets paid to the 401k.

I know the money must be paid back within 5 years and that's not a problem. Neither person pays enough in interest that they can use it for tax purposes. This seems like a great option, but what are the pitfalls, if any?
Print the post  


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.
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.