What is the impact of borrowing from my retirement plan?

Some retirement plans include the option for qualifying participants to take a loan against their retirement account balance. Some people borrow from their retirement plan to pay off high-interest debt, others to make a major purchase. While the borrowing rates may be favorable (typically 1-2% above the prime rate), you'll need to consider the impact on your future retirement earnings. Use this retirement account loan calculator to make a more informed decision.

Keep in mind that if you elect to suspend ongoing contributions to the plan during the loan repayment period, you risk further impact to your future retirement account balance. This analysis does not take into account any loan initiation fees that might apply. It also does not consider the impact of taking a withdrawal from the plan for financial hardship (purchase of a primary residence, college tuition, funeral expenses, etc.). Contact your plan administrator for details on the loan and withdrawal options available to you.