Alert
Close

Help Decide the Future of Aging. Join the White House’s Live Stream From Cleveland Monday. Learn more

Highlights

Open
Renew for 3 and attend Life at 50+ for free

Contests and
Sweeps

You Could Choose Your Dream Vacation!

Hawaii, the Grand Canyon or an Alaskan Cruise! No purchase necessary. Ends May 31. See official rules.


Driver Safety

Piggy bank on the road - AARP Driver Safety

Take the new AARP Smart Driver Course!

You Could Choose Your Dream Vacation
Happy African American couple

AARP Books

Visit the Money Section

Enjoy titles on retirement, Social Security, and becoming debt-free.

Jobs You Might Like

most popular
articles

Viewed

Should I Tap My 401(k)?

Is it possible to use my 401(k) plan to get a loan? –Shirley, California

A loan from your 401(k) plan is an easy way to get necessary cash. This can come in handy if you are having difficulty borrowing money from other sources.

But don't take borrowing from your retirement nest egg lightly. After all, you're borrowing against your future retirement. If you can't pay it back, you'll incur taxes, penalties, and a lower retirement income. If you're going to get a 401(k) loan, it really should be for a very good reason—and almost as a last resort.

Loan Rules

While federal law imposes no restrictions on how you can use the money, the plan administrator can limit loans for specific purposes. In fact, the first thing to do is to check with the plan administrator to see whether or not loans are permitted. If so, find out the permissible reasons to take out a loan. These typically include paying college tuition, funding a down payment on a home for first-time buyers, and  hardship reasons, such as paying your mortgage in order to prevent foreclosure and paying un-reimbursed medical expenses.

Repayment Rules

The rules on repaying the loan are also established by the plan administrator. Typical 401(k) loan rules may include the following provisions: … Back to Article

Topic Alerts

You can get weekly email alerts on the topics below. Just click “Follow.”

Manage Alerts

Processing

Please wait...

progress bar, please wait

Tell Us WhatYou Think

Please leave your comment below.

Advertisement

The Cheap Life

Jeff Yeager Cheap Life Ultimate Cheapskate AARP YouTube web series save money

Catch the latest episode of The Cheap Life starring Jeff Yeager, AARP's Ultimate Cheapskate. Watch

Discounts & Benefits

From companies that meet the high standards of service and quality set by AARP.

Credit safeguards with AARP® Identity Theft Protection from TrustedID®.

AARP Credit card from Chase

Members can get cash back rewards on purchases with the AARP® Credit Card from Chase.

Man using cell phone outdoors

Members save on monthly service & usage fees and get free activation with Consumer Cellular.

Member Benefits

Join or renew today! AARP members receive exclusive member benefits & affect social change.

Advertisement

Advance your skills. Transform your career.

Explore your learning possibilities.