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Ended up not buying the house. I've got $8K of the $9K left. I tried sending it to the 401k to pay back the loan, but they won't take anything other than the full remaining amount of the loan. Meanwhile, the loan is being pulled out of my paycheck every two weeks, on a 3 year plan. Terms: 3-year term, 5% over the amount of the loan added to the 401k, plus something like $45/6-months to the maintenance company.
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Trying to understand the terms.
You pay 90$/year for maintenance fees, which is 1% of principle, but it doesn't decrease as the principle drops.
Any interest on the loan? (ie, money that is lost)
You end up paying 5% more than the value of the loan over 3 years into the 401 k?
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So I'll shortly have the $8K check back in my hands. I figure to either bring it back to the bank and cycle it to my index fund, or pull some money out of the index fund to pay off the remaining amount of the loan.
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I'd be somewhat tempted to pay off your credit cards with it, rather than paying off a probably good-terms loan from your 401 k. Estimate how long it would take to save up enough to pay off the 401 k loan: if a short period of time, put the rest of the money into a safe and flexible interest-bearing investment, put your credit card payments into that investment rather than credit cards, and then pay off the 401 k loan...
If things go badly with your job, you can always use your credit cards to pay off the 401 k loan, and you'd probably end up with less credit card debt than if you paid off the 401 k loan now and kept on giving money to credit card loan sharks.
(I dislike credit card debt)
Is there a time after which you can't pay off the 401 k loan?