Can I take a loan from my 401(k)?

Any unpaid loan amount also means you’ll have less money saved for your retirement. Your 401 (k) plan may allow you to borrow from your account balance. However, you should consider a few things before taking a loan from your 401 (k).

Can a 401(k) loan be repaid early?

A 401 (k) loan can provide competitive interest rates, and you can maintain your tax advantages. Repayments are set according to your loan term, but you can repay a 401 (k) loan early. If you change jobs, you may have to pay back the loan earlier. You can borrow up to $50,000 or half of the amount in your 401 (k), whichever is less.

Can a 401(k) loan be taken out?

A 401 (k) loan is limited to the lesser of $50,000 or 50% of your vested balance. Of course, you can only borrow as much as you have available in your 401 (k), so if your balance is smaller, you won't be able to take out a loan for the full allowable amount. 2. You typically have five years to repay the loan.