What is the impact of borrowing from my retirement plan?

Some qualified retirement plans include the option for qualifying participants to a take a loan against their retirement account balance. Many people borrow from their retirement plan to pay off high-interest debt or to make a major purchase. Although the borrowing rates may be favorable, usually 1-2% above the prime rate, the impact on future retirement earnings needs to be taken into account. This calculator can help you make a more informed decision about whether a loan is the right approach for your financial situation.

During the loan repayment period, if you elect to suspend ongoing contributions to the plan, your future retirement account balance may be further impacted. This analysis does not take into account any loan initiation fees that might apply. It also does not consider the impact of taking a withdrawal from the plan for financial hardship (purchase of a primary residence, college tuition, funeral expenses, etc.). Contact your plan administrator for details on the loan and withdrawal options available to you.
Loan Assumptions
Amount you intend to borrow ($) 
Interest rate on loan (%) 
Years until retirement 
Term of loan (in years)
Term must be less than years until retirement.
 
Anticipated pre-tax rate of return on retirement plan account (%)help
Will loan proceeds be used to pay down existing debt?
If you answered "Yes", please complete the following:
 
   Annual interest rate on debt to be paid down (%) 
   Is the interest deductible? 
   Your marginal tax bracket (%)help
Your Email Address
I am currently a member of Delta Community Credit Union
Please email me special offers and promotions. Information collected is for internal purposes only and will never be sold to third parties.
   
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