The Pros and Cons of a 401(k) Loan – 285

Have you ever considered borrowing money from your 401(k)? It can sound like a pretty good deal. After all, you’re borrowing from yourself, paying yourself back with interest, and avoiding the need to borrow from a bank. But there are some important tradeoffs that you should consider.

A 401(k) loan may make sense in certain circumstances, but it can also create problems you didn’t anticipate. What happens to your investments while that money is out of the account? Could the loan affect your ability to keep saving for retirement? And what if you leave your job before it’s paid off? The answers may surprise you.

When does borrowing from your 401(k) make financial sense, and when could it be a costly mistake? Learn more from podcast host Johnny Dean and Rick “The Professor” Plum, CFP® on this week’s episode of Managing Your Financial Future!

The opinions voiced in this show (program; podcast) are for general information and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investments may be suitable for you, consult the appropriate qualified professional prior to make a decision.

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