{"id":13914,"date":"2023-08-10T00:15:00","date_gmt":"2023-08-10T07:15:00","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=13914"},"modified":"2023-07-03T16:02:16","modified_gmt":"2023-07-03T23:02:16","slug":"100-words-on-why-you-should-resist-borrowing-from-your-401k-2","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id13914-100-words-on-why-you-should-resist-borrowing-from-your-401k-2.html","title":{"rendered":"Is It OK to Borrow from Your 401k?"},"content":{"rendered":"<p><a href=\"https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2012\/07\/401k.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-13955\" title=\"401k\" src=\"https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2012\/07\/401k.jpg\" alt=\"is it OK to borrow from 401k?\" width=\"540\" height=\"405\" srcset=\"https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2012\/07\/401k.jpg 500w, https:\/\/lenpenzo.com\/blog\/wp-content\/uploads\/2012\/07\/401k-300x225.jpg 300w\" sizes=\"auto, (max-width: 540px) 100vw, 540px\" \/><\/a>Roughly 3 in 10 people now borrow money from their <a href=\"https:\/\/lenpenzo.com\/blog\/id8797-differences-between-a-roth-ira-and-traditional-401k-which-is-better-2.html\">401k retirement plans<\/a>. Generally, you can borrow half your account balance &#8212; up to $50,000 &#8212; for as long as five years. But is it okay to borrow from your <a href=\"https:\/\/www.investopedia.com\/terms\/1\/401kplan.asp\" target=\"_blank\" rel=\"noopener\">401k<\/a>? True, it&#8217;s among the cheapest loans available because the interest rate is typically the prime rate plus 1%, and interest is paid to yourself. Even so, the risks are steep; not the least of which is the loss of potential earnings that money could have been accruing on a tax-deferred basis.<\/p>\n<p><strong>The bottom line:<\/strong> There <strong><em>are<\/em><\/strong> reasons why raiding your 401k fund may make sense, but there are many more why it doesn&#8217;t.<\/p>\n<p style=\"text-align: right;\"><span style=\"font-size: smaller;\">Photo Credit: Urban_Data<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Roughly 3 in 10 people now borrow money from their 401k retirement plans. Generally, you can borrow half your account balance &#8212; up to $50,000 &#8212; for as long as five years. But is it okay to borrow from your 401k? True, it&#8217;s among the cheapest loans available because the interest rate is typically the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":38867,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","pmpro_default_level":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[473,464,466],"tags":[],"class_list":{"0":"post-13914","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-100-words","8":"category-retirement","9":"category-saving","10":"pmpro-has-access","11":"entry"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.8 (Yoast SEO v27.5) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Is It OK to Borrow from Your 401k?<\/title>\n<meta name=\"description\" content=\"Generally, you can borrow half your 401k account balance - up to $50,000 - for up to five years. 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