Your golden years are your best years! Make them shine!

  • Home
  • Personal Finance
  • Retirement Life
  • Saving & Spending

401k Loans: Are They REALLY Worth It?

June 1, 2023 · Personal Finance
401k Loan
Photo by Lemau Studio at Shutterstock

Frequently Asked Questions:

Will my employer know if I take out a 401k loan?

Yes, they’ll likely know about any loan from their sponsored plan. You may even need to go through the human resources department to request a loan like this, and you’d pay it back through payroll deduction, which they’d also know about.

Loans aren’t guaranteed to be approved either. Your plan may not even offer them. If you’re concerned about a manager finding out about your loan request, you can ask the HR department to keep your request confidential.

What if I leave my job?

If you quit your job while you still have an outstanding 401k loan, you must repay the entire loan within 90 days. Failing to do so will have the remaining balance be treated as a distribution, and you’ll owe taxes and a 10 percent early withdrawal penalty.

You can’t replace those withdrawals when you have more money. That means you’ll also lose out on tax-deferred growth for that money offered through your plan.

Can I pay off my 401k loan early?

Yes, loans from a 401k plan can be repaid early without a prepayment penalty. Many programs offer the possibility of repaying loans through regular payroll deductions, which can be raised to pay off your loan much sooner than the requirement.

Remember that those amounts are paid with after-tax dollars, unlike contributions made before taxes.

To keep track or your loan and stay organized, we recommend this Clever Fox Budget Planner From Amazon!

Related Article: Got a 401(k) Plan? Here’s How You CAN and CAN’T Take Advantage of It

Pages: 1 2 3 4 5 6 7 8

Share this article

Facebook Twitter Pinterest LinkedIn Email

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recent Posts

  • stimulus check
    Trump Promises $2,000 Tariff Checks: Could You Qualify?
  • social security changes
    5 Social Security Changes Coming In 2026
  • SNAP
    7 Hidden Benefits of SNAP You’re Missing Out On
  • snap supplemental nutrition assistance program
    Americans Are Losing Their Food Stamp Benefits. Are You One of Them?
  • social security numbers
    6 Social Security Changes Coming Next Year
  • Social Security changes coming in 2024
    2026 Social Security Benefits Increase Brings Biggest Raises in 10 States

Related Articles

401(k), security check holiday

Social Security Check: 8 Ways to Live a Comfortable Life Off It Alone

#7 Consider a retirement community If relocating doesn’t sound bad to you already and you’re…

Read More →
tax

5 Tax Records Seniors Should NEVER Throw Out

Where to keep these papers If you are wondering where you store all of this…

Read More →
social security

Some Retirees Won’t Get Great Social Security Benefits- Here’s 7 Reasons Why

Takeaway: Even if it’s hard to believe, Social Security is not a guaranteed benefit. Actually,…

Read More →
part-time gig

10 Great Part-Time Gigs For Retirees (Available Now!)

Bookkeeper If you’re a retired accountant or just good with money, you should consider becoming…

Read More →
Senior Housing, everyday bill

Watch Out: 8 Everyday Bills That Lead to Financial Strain

Did you know that some of your everyday bills are more likely to cause a…

Read More →
retire

10 Things Retirees Hate About Social Security

The economic contraction that hurts The economic disaster that went along with the coronavirus pandemic…

Read More →
tax planning, reduce

7 Ways You Can Prepare For a Better 2023 Tax Season NOW

#7 Transfer IRA money to charity Every year, taxpayers who are 72 years of age…

Read More →
retirement income tax state, retirement distributions

7 States That Don’t Tax Your Pension, 401(k), Social Security, and More

Minnesota Minnesota has the same thresholds as the federal government, to determine just how much…

Read More →
Roth IRA, reduce

6 Ways to Max Out Your Roth IRA in 2023

There is a maximum amount of money you can put into a Roth IRA account,…

Read More →
Retired in USA

Your golden years are your best years! Make them shine!

Inedit Agency S.R.L.
Bucharest, Romania

contact@ineditagency.com

Explore

  • Terms and Conditions
  • Privacy Policy
  • Do not sell my personal information
  • Subscribe
  • Unsubscribe
  • Contact
  • CA Privacy Policy
  • Request to Know
  • Request to Delete

Categories

  • Enjoying Retirement
  • Personal Finance
  • Saving & Spending

© 2025 Retired in USA. All rights reserved.