All Forum Posts by: Michael White

@Ned Carey yes I think there’s confusion. By get money back in the market I mean to say get the money back in my 401k by paying off the loan. I’m thinking the 401k loan is worse than the home equity loan because of the fixed repayment period (I cannot increase my payment) and because I could have that money in my retirement plan earning for me. 

I understand that you could view this as borrowing at a high percent to invest and I agree that’s not a good approach, but the 401k loan is something I feel like I want to undo or correct- I also should note I would have to pay back in full if I wanted to leave my current job. 

 The interest rate on the 401k is lower. My thought process is two fold:

1. I can pay back the HELoan as quickly as I want in respect to the piece related to the 401k. This would offset the interest difference and give the flexibility to payoff as quickly as I want

2. I would have the opportunity to reinvest this money at a market low point and this is the big opportunity cost I feel I missing - 35k being invested and gaining over time

Basically I feel like the 401k loan is a loan type I should pay off asap to get that money back in the market and compounding

Hi all - first time poster, and I have a question on best approach. For my current primary household, I used a 401K loan as a down payment. There's 36k remaining on the loan. I am currently putting an in-law suite addition on the house and using a home equity loan to do the reno; my question is should I pull out an additional 36k from our equity to repay the 401k?

Note: The 401K loan has to be repayed in full if I want to pay it off early, otherwise I have a scheduled $75 payment each pay period for the next 28 yrs.

Hi all - first time poster, but have a question on best approach. My current household I used a 401K loan as a down payment. There's 36k remaining on the loan. I am currently putting an in-law suite addition on the house and using a home equity loan to do the reno; my question is should I pull out an additional 36k from our equity to repay the 401k? 

Note: The 401K loan has to be repayed in full if I want to pay it off early, otherwise I have a scheduled $75 payment each pay period for the next 28 yrs.