Some retirement plans allow for loans to be taken against the balance of an account.
The funds come directly out of a participant's account, and the loan repayments, including interest on the loan, go directly back into the account. While a loan from your plan can be an alternative to borrowing at a higher interest rate from another lender, taking a loan from your plan can have significant long-term consequences . Even though you pay yourself back with interest, you lose a lot of time in which your loan amount could have been working for you. The minimum amount and number of loans you can take will depend on the rules of your plan. For more information on your plan's loan provision, contact your plan administrator.