All Forum Posts by: William Duncan

@Cameron Tope,

Did you borrow from your 401k on your first or second property? If second, how did you go about buying your first/would you have done that same strategy as the second on the first?

I have been noticing interest rates continuing to drop and have seen them hit 2.5-2.75% recently. As a 26 year old, I have been aggressively putting money into my 401k for retirement and paying off student loan debt. I have no other short or long term debt. In total, I have roughly $29k in savings and $24k in student loan debt. However, these interest rates seem too good to pass up and I've heard about new policies being put into place that allow for increased forgiveness for drawing out of one's 401k. 

My thought was that it might be worth it to draw my 401k to use as a down payment on a property to lock in one of these low interest rates to purchase my first property. The next move would either be to continue to pay relatively inexpensive rent and cash flow the property, creating additional income, or move into the property with almost certainty that the mortgage would be significantly cheaper than my current rent, which would increase my cash flow.

What advice is out there for making this decision, how should I look at this in a unique way, and what am I not considering when making this decision? Thanks!