Many Americans are increasingly anxious about a potential recession, driven by tariff policies and fears of rising prices. This anxiety leads some to consider 401(k) loans as a source of emergency funds. Though these loans appear advantageous because they require no credit checks and allow for interest repayment to oneself, they carry significant risks. Borrowers may face tax consequences if they fail to repay, and missing contributions during repayment can hinder long-term retirement savings. Planning ahead with a financial advisor can provide better strategies for financial stability amidst economic uncertainty.
It can be tempting to take out a 401(k) loan to cover expenses, especially during times of uncertainty, but borrowers must consider the potential risks involved.
While you do typically have to pay interest on a 401(k) loan, you're paying the interest back to yourself, which can make it seem like an attractive option.
Collection
[
|
...
]