Yes it does, lots. You know, Mr. MOguy and I have been on opposite sides on the following question: Get out now, pay down all debt? (that's me). Or believe in the end, it will all work out, if for the only reason that we are damaged, but damaged less than the rest of the world (that's him).
We are currently discussing this....
MOgirl
My wife and I are having the same conversation. She says we stay in and ride it out. I say bail now.
She was right in 2008..... we have made that loss back and them some.
Somedays, I wish I still drank. ;>)
Many 401(k) plans allow you to withdraw up to 50% of the value of your account -- with a maximum of $50,000 -- as a loan. You can usually get these at a very low interest rate, and what's even better is that you pay the loan and the interest back to your own 401(k) account.
If you want to pay off your debts and you can afford to pay back the loan over a five-year period (with money taken from your paycheck every two weeks, or however often you get paid), you might want to consider it.
I'm no financial advisor, but I do know that the money you lose in an early 401(k) withdrawal is substantial. You'll pay income taxes on the withdrawal (at your current tax rate), plus an early withdrawal penalty of 10% (I think).