The Dangers of Borrowing from Your 401k

While taking a loan from your retirement savings may be preferable to cashing out, the dangers of borrowing from your 401k are a serious threat to your retirement dreams. While they are actually a good deal, especially as loans go, the effect on your retirement savings can be devastating.

Not every employer offers this as an option with their plan, but the ones who do are generally set up the same way. You will pay a very low interest rate and what you do pay will go back into your account. You can borrow up to $50,000, or 50% of your account balance, whichever is lower. You will have five years to finish repaying the balance.

So far, all of this sounds like a pretty great deal as far as loans go, and it is really! But there are dangers borrowing from your 401k, and too many people fall prey to them.

To understand the consequences of some things you need to understand that when you cash out from your account you have to pay a penalty. This consists of both federal and state taxes, plus a ten percent early withdrawal penalty. Depending on your tax bracket this can easily add up to thirty to forty percent.

As stated above you have five years to repay the balance. If you fail to repay the balance in that time then what is left is treated as though you cashed out in the first place.

If you lose your job before finishing repayment, it is also treated as though you cashed out in the first place. Of course few people plan on this happening, but are you really sure that you won’t end up quitting for a better opportunity sometime within the next five years?

For all of these reasons, and more, it’s best to look into other options and carefully consider the dangers of borrowing from your 401k before taking out a loan from your account.…

National Debt Relief Program 2021

There is a great need for debt relief on a national program level; a national debt relief program. Sadly, as of this writing, President Barack Obama and the U.S. Congress have yet to enact such legislation, though over a trillion dollars and counting has been disbursed in debt relief bailouts to everyone from Wall Street, to the auto industry, to Freddie Mac & Fannie Mae. The question on many people’s minds is, “What about us folks on Main Street? Where is our bailout? Where is our national debt relief program?”

Fortunately, where Congress and elected officials have failed the American people, the U.S. financial services sector has stepped up to plate. Through a national debt relief program, those Americans who are struggling with debt and indeed buried in debt can obtain the much-needed debt relief that they deserve.

Working class America has been battered on all sides in recent years. The economic recession, the elimination of over 8 million jobs, home values in free fall, a foreclosure crisis, a personal debt crisis, and now of all thing an oil spill that will have untold economic ripples. Yet help is available. Through the national debt relief program that is underway, Americans have access to services that can intervene in their unsecured debt situations.

Unsecured debt includes debt such as credit card debt, medical bills, and department store cards. Government programs already exist which offer mortgage help and student loan consolidation. This national debt relief program is offered by the highly efficient debt relief arm of the U.S. financial services community. Through this debt relief program, up to 50% or more of unsecured debt can be eliminated, providing debt relief that is truly national in scale and scope.

To learn more about the national debt relief program that is available to residents in all 50 states and how to get started, please visit National Debt Relief Program.…