401 k Cash out or IRA Rollover

[WildKat]

I really need to borrow some money for my girlfriend to get her back on her feet...no she's not a bum or anything like that, but has been bitten by the economy and went from 6 fig job to prob half of that...She is behind on her mortgage and her car....I want to help her out and catch her up.....I am more than likely going to move in with her to help with future expenses as well...I have a little in my 401 k that I can take out, but I know that I'm gonna get hit with penalties left and right.....I thought I read that I could roll it into an IRA and just borrow what I need from it.....I only have around 9000 vested.....I prob only need 3500 to get everything straight...................Any help would be appreciated.

[ZoomVT]

oh boy. this thread has all the makings for a classic.


I dont know enough about 401k stuff to be comfortable giving you an honest opinion. But good luck with that man. hope it works out.

ps. one thing i have always been told is: do not borrow against your future (retirement). you are better off getting a personal loan from a bank at a decent rate (7% unsecured).

[rjb1816]

agree with zoom...try and get a line of credit or something before taking out of a retirement acct. not only are you paying penalties but you are missing out on growth...gl

[WildKat]

Originally Posted by ZoomVT

oh boy. this thread has all the makings for a classic.


I dont know enough about 401k stuff to be comfortable giving you an honest opinion. But good luck with that man. hope it works out.

ps. one thing i have always been told is: do not borrow against your future (retirement). you are better off getting a personal loan from a bank at a decent rate (7% unsecured).

Yes, I thought about the loan, but that was after I resigned from my job earlier this week....gonna think that the banks are gonna balk at me wanting a loan with no income at this time....It under 10,000 so I'm not to worried about the retirement issues...........and I hope this doesn't turn into a 3 ring circus because it's fairly serious.

[Windy City Irish]

do you own a home? can you get a line of credit against any equity you have built up?

[ZoomVT]

i think you can still go to the bank and get a loan. It has just been a week, so you still have copies of your last paycheck, etc.

they dont need to know that you resigned recently.


and, not to pry into your personal live. but if you just resigned, and she is hurting. hope you have hashed out a plan to put it all back together.
Under this scenario, maybe it does make sense to borrow against your 401k; only because without income i dont see how you would pay the personal loan.

[ZoomVT]

Originally Posted by Windy City Irish

do you own a home? can you get a line of credit against any equity you have built up?

this is a good point. not that is easy; nowadays those are pretty hard to get too unless you have over 25% equity and they will only let you borrow up to 20%equity so that there is always 20% equity left in the property. She owns a home, she could get a 2nd mortgage or HELOC. The problem is that they are even more stingy on checking your finances for these kind of loans. a personal loan is quick and painless.

[Jahred]

"girlfriend"

if you have real friends they will be in your living room when you get back from work to talk about your discision making lately

unreal , they guy that can sell a half drank mixed smoothie , in a fukin casino loooo cant see whats happening

sigh

[Big Pimpin]

Do I have the facts straight?

1. You don't have a job at all?

2. She has a job making 50+k a year..

3. You are trying to help her out with her bills?

[WildKat]

No, I'm not a homeowner at this time......but, I have good credit...The banks are real stingy about giving cash loans right now without owning a house.....I have some other job opportunities that will happen in the next three weeks.....I knew that I had enough money saved back to help take care of myself....She does have a 2nd mortgage already out...She has a rental as well, that she doesn't really make any money off monthly, just has kept it for future investment.......

[Big Pimpin]

Originally Posted by Jahred

"girlfriend"

if you have real friends they will be in your living room when you get back from work to talk about your discision making lately

unreal , they guy that can sell a half drank mixed smoothie , in a fukin casino loooo cant see whats happening

sigh

he has no job so that wont work

[WildKat]

Originally Posted by Jahred

"girlfriend"

if you have real friends they will be in your living room when you get back from work to talk about your discision making lately

unreal , they guy that can sell a half drank mixed smoothie , in a fukin casino loooo cant see whats happening

sigh

I forgot about that! lol

[WildKat]

Originally Posted by Big Pimpin

Do I have the facts straight?

1. You don't have a job at all? YES

2. She has a job making 50+k a year.. Yes

3. You are trying to help her out with her bills? YES

Yes

[Big Pimpin]

Wildkat.....


Sounds like me she should look into downsizing and selling that rental IMO....I'd look at those options before shelling out my own coin to a girlfriend.

I mean....although its a noble cause you are asking but shouldn't she try these things before you give out your hard earned money

[Big Pimpin]

Originally Posted by WildKat

Yes