Keep The Course: Commonly Asked Questions-Can I Withdraw Money From my 401(k) to Buy a Home?

Each Wednesday 401kBasics posts a new article in a weekly series called “Keep the Course”. This series is designed to give the average consumer information on how to keep their 401k plan on track! Your feedback or suggestions on future articles is welcome.

Over the next few weeks, 401kBasics will feature some of the most commonly asked questions.

”Can I withdraw money from my 401(k) plan to purchase a new home?”

If your plan allows for loans and/or hardship withdrawals you may be able to use your 401(k) money to purchase a new home.

  1. Residential (Home) Loan: Non-taxable, you pay yourself back.
  2. Hardship Withdrawal: Subject to income and a 10% early withdrawal penalty tax. You do not pay the money back.

You generally need to provide copies of the purchase and sales agreement to utilize either option.

This site is for entertainment purposes only. 401kBasics and it’s authors are not financial advisors and no information found on this site should be construed as financial advice.

Advertisements
This entry was posted in Participant Guidance and tagged , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s