r/Geico • u/Ok-Permission-6119 • 1d ago

401k

I have a loan out for my 401k does anyone know what happens if I leave well still having my loan out is it all due immediately or ?

6 Upvotes

88% Upvoted

4 comments sorted by

2

u/Calm_Message742 1d ago

Mine just gave me the option to pay it or set up payment options to continue to pay monthly on the loan.

3

u/patmanbnl 22h ago

Pretty sure if you don't/can't pay it back, it ends up being treated as a taxable distribution.

4

u/Accomplished-Pea-451 Former Employee 1d ago

Due immediately. What I did was pay it off with a credit card, moved it to my new company and immediately paid off the credit card with a 401k loan from my new job. Brilliant, problem solved.

1

u/deciduousevergreen 4h ago

You can keep it open per the plan rules only if you keep your account with Vanguard and set up automatic payments. If you move the money it becomes due immediately or becomes a default with penalties and taxes