An interesting development and Sportsmansguide
So I got my first paycheck since I took out the loan on my 401k. Surprise, surprise my takehome is now more than it was after the loan payment is taken out. All payments into the account are tax deferred so if after making your payment you end up in a lower tax bracket the amount that you're taxed is reduced. That could make your paycheck bigger than before even after you make your loan payment. Any payments made towards your 401k are taken out of your check by your employer before you get the income so you're not taxed on it. Oh and the interest rate on my loan is only 5.5%. If you have a 401k, lots of credit card bills and you don't foresee losing your job anytime soon then educate yourself. This could be a very good tool to get yourself out of debt. Technically, I only owe myself the money that I borrowed. If something happens and I can't pay myself back then I have to pay a 10% penalty on the amount that I borrowed and the amount of the loan counts as taxab...