401k cashout?

Guest

I am a 44 year old male. I took a 401k loan of 50k and lost the money. This was a 30 year loan. I want to pay back the loan from my 401k but it is not possible. I have 66k left and dont know if that will cover the debt. I have no other savings to pay off the loan. My pay check is currently paying into the loan but I need the income to pay daily bills.

jerry · Posted: Sat Nov 21, 2009 4:30 am Post subject:

Hi rjm,

I understand you are in a difficult financial situation. But you will have to take another loan from your 401(k) account to pay off the existing loan. You will be subject to a 10% penalty and your current tax rate. However, I don't think it will change your situation much. You still have to pay off the new loan and the payments will be deducted from your salary.

Thanks,

Jerry

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