Im trying to buy a house, is it wise to pull money out of my retirement ?

Question

Im 27 and I feel I have a long time to make that money back up.

Answer 1

Depending on the location of the house, owning a home is a good investment for your retirement. My home has tripled in value since I bought it and I certainly consider it as part of my retirement income, along with my 401K, to which I continue to contribute twice a month. So, yes, I think it would be wise, with the caveat that you don't want to buy a house that will lose its value in a poor housing market for the area. Some research and some common sense should enable you to purchase something that will retain and gain in value. The other thing you have to be aware of is the interest rate, and whatever you do, do not get an adjustable rate, get a fixed mortgage rate.

I appreciate what the answerer above me said, and you should weigh that advice as well, but I did pull $70,000 for the down payment out of my retirement, took the 30% hit, and still made a profit of $400,000, based on the current market value of my home, so it is not as black and white as all that.

Answer 2

No. Assuming it's not a Roth, these are the consequences.

First there is a 10% penalty right off the top. Then it all gets taxed the year you withdraw, by adding it straight to your income. Of course that means it's taxed at the highest rate. The same applies if you have a state tax.

When all is said and done, you could be looking at a 30% to 50% penalty on whatever you pull out.

Answer 3

if you've done the math and you can save for retirement later then go for it. you can get great deals now for a fixed interest rate on mortgage payments. this is only for a short time where you will find a low interest rate.

invest only if your opportunity cost is greater with the purchase of the home which outweighs the costs of losing a retirement plan.

good luck.

Answer 4

you're no longer paying that interest back to your self. i've got self assurance you're in user-friendly terms getting the down value from that. seem very intently on the reimbursement plan to work out how a lot of your early money are concept, I guess that is totally little early on. while you're incredibly getting 8.25% these days, i might say bypass away it on my own. The holder of that annuity needs you to apply up it. in case you may get a everyday loan, that is perhaps extra perfect. these days that is a customer's marketplace in many places. Do learn on the valuables's historic fee so as which you recognize it remains no longer overpriced. whilst it comprises significant economic transactions...have confidence no person!!!! (extraordinarily individuals like me =) verify and double-checkyour information and do employer in user-friendly terms with respected agencies....in case you will discover them. in actuality, bypass away that annuity on my own for now. Do be conscious that tax regulations and rules on tax-deferred gadgets will probably substitute, so stay reported.

Answer 5

No don't do it... think about it..... why take money out of a fund where you may not have enough when you retire.... i would sug. just get another job if possible.... it would work out much better... i would only pull money out of my retirement if it would help such as investing in a business, because you could make that up easier.