Best way to do 401k loan for capital

[Ladd Krestan]

Hi All, my fiancé and i are looking for advice on how to take the money out of her 401k for capital without getting hammered on taxes and penalties? Or only having access to 50% of balance. IRA?

No longer with the employer that hosted the 401k. Any ideas would be appreciated.

Thanks

[Brian Eastman]

@Ladd Krestan

Since she has left the employer, she can likely no longer take a loan.

If you want access to the money personally, there is no option other than taking a distribution.  If she is under age 59 1/2, then an addition 10% penalty.  Probably not a smart move.

She could rollover to a self-directed IRA, but that would not provide either of you with access to capital. That would purely be a means to have the IRA invest in real estate or the like. In that case, you cannot benefit from the funds, and all income has to go back to the plan.