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



most popular



Best Employers for Workers Over 50

See the latest winners of this AARP recognition program.

National Employer Team

See which companies value older workers.

Employer Resource Center

Attract and retain top talent in a changing workforce.

Ask the Experts: When a Layoff Catches You With a 401(k) Loan

Q. I was just told I’m going to be laid off. What happens to the money I borrowed from my 401(k)? I haven’t paid it back in full yet.

A. When your job is terminated, any money that was borrowed from your 401(k) account becomes due, usually within 60 days. If you cannot afford to pay it back, the amount you owe will be treated as an early withdrawal if you’re younger than 59½. It will be taxable and you’ll owe a 10 percent penalty—except in certain circumstances. For example, if you’re at least 55 years old or disabled, the penalty won’t apply.

Carole Fleck is a senior editor at AARP Bulletin.

Topic Alerts

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

Manage Alerts


Please wait...

progress bar, please wait

Tell Us WhatYou Think

Please leave your comment below.

Jobs You Might Like

Jobs You Might Like

Discounts & Benefits

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

UPS Store membership discount aarp benefits

Members save 15% on eligible products/services, 5% on UPS shipping at The UPS Store®.

membership adt

Small business owners save 20% on new installation of any new ADT security system.

Man using cell phone outdoors

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

Member Benefits

Renew today! Members receive exclusive member benefits & affect social change.

Advance your skills. Transform your career.

Explore your learning possibilities.