13. Taking 401(k) Loans
When facing rough moments you may be tempted to take 401(k) loans. If an employer terminates you while you have an outstanding loan, however, you could wind up taking an unwanted distribution from the plan, owing taxes and a penalty if you can’t pay it back immediately. (You can find yourself caught in taxes and penalties if you don’t manage to pay it back in time.) Using a 401(k) can become expensive and put a hole in your retirement savings.
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