Comments on: Exploring the 401(k) Rules in Times of Financial Trouble

By: S

Mon, 08 Aug 2011 23:13:44 +0000

I have a 401K plan with Fidelity.

I have zero debts and this includes: no mortgage, no credit payment, no credit card.. nothing..

I have a large amount in my 401K and am getting nervous now that Obama and his happy band of socialists are hell bent on making the dollar worth the same as Monopoly money.

Anyone got any ideas on what to do with my 401K… I don’t want to cash it in, but rather to try and roll it over to something that will stand the test of an economic catastrophe.

I was thinking about Gold??

By: 401krolloveranswers

401krolloveranswers — Tue, 19 Apr 2011 03:00:01 +0000

Hi John, I have to plead ignorance on this issue. It would not surprise me if they took the money as partial payment, but I have no idea how it might go. You should contact the IRS or get the help of a CPA. Good luck!

By: John

John — Mon, 18 Apr 2011 17:09:56 +0000

I have moved to a new job. I have about 17K in my 401k and am cashing it out. I owe the government 22K, I want to know if I cash out the 401K will the government take my check. I am set up on monthly payments.

By: Robert

Robert — Sat, 06 Nov 2010 22:54:01 +0000

I like this article.. This is my first trip to this site. Thank you for sharing. I will revisit this site. I am a race car mechanic. My repair tip of the week is: Please do not attempt a extremely difficult fixer by yourself. This will cost you more money in the end. Thanks again..

By: 401krolloveranswers

401krolloveranswers — Thu, 30 Sep 2010 13:54:13 +0000

Hi Kim, Good question! To my knowledge the loan against 401k is truly applicable JUST with a 401k account. Please check with the firm you are using for your IRA — they will have the final answer. The reason I am (fairly) sure that you cannot take a loan against an IRA is that there are no provisions to ensure repayment. With a true 401k, the employer has control over the repayment structure and the government has the back up of charging you taxes if you fail to repay before you leave the job.

It is hard to say, since I don’t know what you want to use the loan for, but you should talk with your local credit union about a loan. I know 401k loans can be attractive since there’s no credit check, etc, but explore your options.

By: Kim Mazzochette

Kim Mazzochette — Wed, 29 Sep 2010 21:40:47 +0000

Can I take a loan against a Rollover IRA at an independent financial institution? The money in the Rollover IRA is an accumulation of past 401 K’s from previous employers.

By: 401krolloveranswers

401krolloveranswers — Wed, 29 Sep 2010 13:24:55 +0000

Hi Lonerider, It is worth talking with your old employer about the loan, but I think the 60 day repayment is a solid fact. If you cannot pay back the 19k, you will owe taxes on that amount. How much tax depends on your tax bracket. Check with an accountant to get an estimate on the tax hit. Now, this presupposes that you CANNOT pay back the loan. If you can, pay it back and avoid the tax and the penalty.
I would do a rollover to the IRA, but that is just my opinion. I am not a certified financial adviser — ask the credit union adviser what he or she would recommend. I am a fan of the rollover so that you can keep up with contributions instead of having your retirement fund lie fallow for a year.

By: lonerider

lonerider — Tue, 28 Sep 2010 22:13:33 +0000

i owe about $19000 that i borrowed against my 401k and cant roll it over into my new employers plan for 1 year how much would the tax be on the amount i owe? i have a total vested balance of about 105,000 and that total includes what i owe t’words the loan and can i go to the credit union and roll this over into say an IRA or what would be the recomended way to go

By: Divorce

Divorce — Tue, 27 Jul 2010 22:33:17 +0000

interesting post indeed =)

By: Leopoldo Mikels

Leopoldo Mikels — Thu, 08 Jul 2010 04:55:58 +0000

Very interesting post thank you for writing it I just added your blog to my favorites and will be back By the way this is a little off topic but I really like your blogs layout.