Lots of literature about this, but curious about opinions. Is it wise to take 50k loan? Would it be better to just take 10K no penalty, no interest? Or in some cases just take the penalty fees if matching is high enough?
Lots of literature about what? About NOT using the pension to buy stuff? And you still want a blind advice from kids who dream to have salaries they claim to have? Baby Jesus, help us
NO. You put that 50k into your 401k with pre tax dollars. To pay that back you will do it with after tax income. So 75-80k. Plus it won’t make money for you while it is out of the 401k.
If you absolutely need to take it from 401k then sure go for it and opt for the max repayment term ( even if the no: of years does not make practical sense still opt that payback option and you should be able to pull it off just fine).
I took the 50k loan. The interest you pay goes back into your 401k so it’s like paying yourself to borrow money.
Is this true?
You’re saying at the end of the day you aren’t paying any interest.
I took out 25k 5 years ago to buy a house in Redmond with an FHA loan just sold it made $400k ymmv
401K is bullshit. Buy a house. Better investment.
401k is what you make of it. You select where you invest. If you invest poorly you will probably get your result.
So that's in most cases not true since with 401k (a) you get free money from your employer and (b) the us stock market has outperformed real estate over the last 40 years
I would only use it as last resort