Borrow From Your 401k Or Finance A Vehicle?

Should you borrow from your 401k to finance a vehicle? In this video we model scenarios as to when it makes sense.  First thing to understand is how a 401k loan actually works. You can borrow up to 50% of your balance or $50k, whichever is less.  So if you have $10k in your 401k, you can borrow $5k. If you have $50k in your 401k, you can borrow $25k.  If you have $150k in your 401k you can borrow??? That's right, $50k.  Good job! So, let's say you have $50k in your 401k and are looking to buy a vehicle for $25k.  You can borrow the $25k from your 401k or you can finance it through the dealership.  $25k borrowed from your 401k at 5% interest means you're monthly payment will be $470.   Thus this decision really comes down to what the interest rate is your dealer or bank is offering.  Watch the video and I show you some examples. Hope this helps! ================================= If you like what you see, a thumbs up helps A LOT. So, give me a thumbs up, please! Don't forget to SUBSCRIBE by clicking here: https://www.youtube.com/channel/UCSEzy4i9xrKPoaU9z0_XbmA?sub_confirmation=1 GET MY BOOK:   Strategic Money Planning: 8 Easy Ways To Put Your House In Order It's FREE if you're a Kindle Unlimited Subscriber! https://amzn.to/2wKGi50 GET ALL MY LATEST BLOGPOSTS: http://heritagewealthplanning.com/blog/ PODCAST: https://itunes.apple.com/us/podcast/josh-scandlen-podcast/id1368065459?mt=2 LET'S SOCIALIZE! Facebook: http://Facebook.com/heritagewealthplanning Linkedin: https://www.linkedin.com/in/joshscandlen/ Quora: https://www.quora.com/profile/Josh-Scandlen Google +: https://plus.google.com/u/1/108893802372783791910