Agree with Bootstrap method for 401k loans

by Jason
(Ohio)

I began using my 401k to buy homes more then 10 years ago. I've twice used a 401k loan with a 10 year payout to buy my primary home. Sold the primary home and bought another with a 401 loan for a downpayment on my new house. Then I converted my previous house to a rental.

I've also used a 401k loan twice with the 5 year payback to provide cash to buy straight rental properties.

The loans have provided a steady return to my 401k portfolio as I paid them back - much better then my skill at timing the stock market.

Of course, I've not quit my job so that has been a big plus so as not to have to "payback" the loans on employment termination