can I roll over my 401k from an old company to the financial institution that currently holds it?

Question

I no longer work for the company that supplied the 401k but it has been sitting at a financial institution gathering interest and growing pretty well. I want to roll it over to the finance company that it is sitting at so that I can borrow against it. Is this possible?

Answer 1

It seems what you are asking is if you can roll over a 401k but keep it with the same institution. If you roll the 401K over you must roll it to an IRA. There should be no reason you couldn't keep it in the same institution. You cannot borrow from IRA accounts but you could take a distribution and redeposit it within 60 days if you needed money for a short time. If you have a 401k now at a new job you could roll this one over to the new plan and possibly borrow from that plan. Not a good idea to take money out of 401k until you are 59 1/2 unless you really really need it. You end up paying at least 35% back in taxes with tax and penalties.

Answer 2

You can roll it, but if you borrow against it you will be taxed heavily. The idea is that you may not use that money or encumber it until you retire. It would need to be a direct rollover from one plan to the next.