Home improvements using 401k..good idea?

Question

I will be adding rooms and doing home improvements however; should i use 401k since???
i've had this for many years and will be the first time??? how does this go?

Answer 1

You can't take the money out of your 401(k) without paying taxes and penalties.

You could take a 401(k) loan, but that is a bad idea since your money would stop workign for you and you would be required to pay the loan in full if you leave your job.

You r 401(k) is your RETIREMENT account. IT should be used for RETIREMENT, not home improvements.

You've had it for years and this will be the first time? Huh? A 401(k) should grow for your entire carreer and then be withdrawn in retirement. I'd hope that you have had it a long time!

Answer 2

IMO, it is almost never a good idea to borrow from or "cash out" part of your 401(k) before age 59.5. This is meant for your retirement. Two big problems:

1) If you take a distribution, you pay taxes + 10% penalty tax. If you take a loan and do not pay back on time, the IRS counts this as a distribution and you pay taxes + penalty. If you change jobs or are fired, you will be required to pay back the loan immediately or else pay taxes + penalty.

2) The power of compounding allows you to be able to save for retirement. Over long periods of time, the compounded earnings will usually outweight your own contributions. (Check out chapter 3 of my free downloadable book at http://www.invest-for-retirement.com to see more details). If you remove money from a 401(k) you are limiting the ability for that money to compound.

You cannot borrow for retirement.

Answer 3

the only time you can take out of a 401k without penalty is BUYING a home. Not remodel. Leave your 401 alone.

Answer 4

You're much better off getting a home equity loan (or home equity line of credit) from a bank or credit union. The others are right, don't use your 401k for this.

Answer 5

The Fathers of the Church followed the rabbis in referring to this as the Divine Accommodation, meaning God suits the stage of man's development, which is why we didn't go directly from thou shalt not kill to turn the other cheek but stopped off at an eye for an eye This is discoverable within maybe 15 minutes of looking for an answer. I just want readers to know what a fraud you are and I've succeeded I think.

Answer 6

Never ever use 401K money to do things that is not urgent such as paying medical bills, avoid bankruptcy, etc.
Not a good idea.

Answer 7

if you use your 401k you will have to pay a penalty and also they take the taxes out from what u already have in it