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Permanently Disabled and Needing 401k Cash. – Alan

“Dear Steve,

I am 50 yrs old and on permanate dissability. i make 1,300 a month from ss and 1,089 a month from an insurance policy through my last employer. i have a morgage for a mobil home of $250. the park space sewer trash ect. payment of $850. a month and a brand new car payment of $320. for the next six years. with insurance and living expences also i am paying back $190.00 amonth for a loan on my 401k.

i am having trouble making ends meet. can i get out of paying this loan back my 401k has $23,000.00 minus the $9,000 i borrowed three years ago. Can i withdraw the rest? I am barley sqeeking by each month and my park rent goes up 3 percent every year so does gas groceries ect. but my pay stays the same please help

sorry i got carried awy and ask question in background section if this is not acceptable i will try another day

Alan”

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The Answer

Dear Alan,

You can certainly talk to your 401(k) plan servicer and see if there is any plan that allows you to stop the loan payment or withdraw the rest due to your medical condition.

But the bigger concern is that the $190 payment is the difference between sinking and swimming. It seems like your budget is pretty close to the edge and regardless of the loan payment, all it will take is one big unexpected expense and you will be in a word of financial hurt.

Talk to your 401(k) service and then post an update in the comments section below.

Big Hug!

Permanently Disabled and Needing 401k Cash.   Alan
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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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