Home  >  Financial Articles and Q&A  >  How much can I borrow with my 401k?

How much can I borrow with my 401k?

Mar 20, 2016 by shawn in  |  Flag
1 Answer  |  3 Followers
Follow Question
0 votes

Hi Shawn,

The max you can borrow from your 401k is $50,000 or 50%, whichever is less. Thus, if you have $10,000 in your 401k, you can borrow $5,000. If you have $150,000, you can borrow up to $50,000. Good luck!

1 Comment   |  Flag   |  Mar 21, 2016
Christian Frederik Hviid

Consider that, typically, non-hardship loans against 401(k)'s must be repaid within 5 years if you remain employed by your employer. However, if you leave before the 5 years are up, loans must be repaid within 2-months of your departure. After 2-months, any outstanding loan balance would very likely be treated as taxable ordinary income. Also, if you are under the age of 59.5, you could also be subject to an additional 10% early withdrawal penalty on the outstanding loan balance. Check plan docs or consult with your tax or financial adviser to know the implications of leaving your job with a 401(k) loan balance.

Flag |  Apr 14, 2016 near Rockville, MD

1|600 characters needed characters left