401k withdrawal for home repair
I will be 62 in September and retired from UPS last July. My pension is good around 4000.00 per month and my house and credit cards are paid off. My car payment and utility bills are what I owe each month. I’ve veen thinking since my wife and I are getting older if it’s a good idea to tap my 401k to buy our cemetery lot and prepay for our funerals. I have approx. 400k in 401k and was thinking besides the funeral plot and arrangements to get a little extra to replace the rest of windows I need to replace and maybe some flooring. Our furnace and central air are about 3 years old and should be good for a while. The roof and sidings were replaced 1 yr. Ago . So I feel these may be the last big things to get done before I pass on. Is it wise to withdraw 50 to 100k of 400k to take care of these things. My wife is 70 ?
Terry Says
This is a big question, and I can’t give you my blessing without knowing more.
You’re only 61. You’d be giving up more than a decade of tax-deferred growth if you take the money out now!
If there were an immediate urgent need, I’d understand. But who knows if you will still be living in this house in 10 years? So why out all that money into it now?
As for purchasing a cemetery plot, that’s not a bad idea. But don’t trade financial security while you’re alive for real estate after your death.
Let me recommend two different things.
First you need to get some retirement planning advice from a fee-only FIDUCIARY who is not tying to sell you something!
Read this:
https://www.terrysavage.com/pam-krueger-wealthramp/
And unless you have some good conservative investment options in your old 401k plan, you might want to do a rollover. Read this, but first meet with a fiduciary planner.
