Cashing out your 401k before retirement can be very expensive, so you may want to think twice before doing so. You should think it over very carefully before finally deciding to take money out of your 401k – especially if you’re just doing this for quick financial assistance. Some people are really tempted to cash out 401k, especially during hardships — but this can cost a lot of money today, and even more profit opportunity in the future.
There is actually another (and often better) option: to borrow money from your 401k account, which can also help with your quick financial needs. Most of the time, borrowing from 401k is much better than a total cash out. With this, it is essential to be familiar with the 401k loan rules.
• Use our 401k Cash Out Calculator to see how much money you will lose just by taking money out of your 401k!
