TSP loan or taxable brokerage account withdrawal?

[Anonymous]

Depending on how much $$ you have in your brokerage, you may be able to get a line of credit against your brokerage account.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I’m confused. Under what scenario would someone suddenly need $50k cash? I can’t think of any.

Medical expenses can hit this easily. Many things are not covered like dental and certain types of in patient facilities like rehabs, and you have to come up with the cash upfront.

Only if totally uninsured. I have a really crappy plan HDHP and my out of network OOP max is still $20k. $50k is a lot of money to be “unexpected” and also not be eligible for a loan.

Ha! We carry two PPO insurances, plus two dental insurance plans. Had to pay $60,000 up front for extensive dental work an older child with gastroparesis needed.

WTF? Your kids have shark teeth?

Np here. The PP's kid has special needs, like you have low IQ and EQ.

[Anonymous]

OP, I would go 50/50 - half brokerage, half TSP.

[Anonymous]

There are no material downsides to a TSP loan. As others have pointed out, you pay the interest to yourself, so the interest rate is not really relevant to evaluating the relative merits of a TSP loan. The "opportunity cost" of not having the funds invested is true for any purchase, including one funded by cash or by withdrawing from a non-retirement account.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I’m confused. Under what scenario would someone suddenly need $50k cash? I can’t think of any.

Medical expenses can hit this easily. Many things are not covered like dental and certain types of in patient facilities like rehabs, and you have to come up with the cash upfront.

Only if totally uninsured. I have a really crappy plan HDHP and my out of network OOP max is still $20k. $50k is a lot of money to be “unexpected” and also not be eligible for a loan.

Ha! We carry two PPO insurances, plus two dental insurance plans. Had to pay $60,000 up front for extensive dental work an older child with gastroparesis needed.

WTF? Your kids have shark teeth?

Np here. The PP's kid has special needs, like you have low IQ and EQ.

lol relax pp. you are wound up too tight!!

[Anonymous]

The need for $50K could be any number of things - sudden emergency repairs to a house not covered by homeowners insurance, a kid who needs out of network in patient mental health care, drug treatment in a private facility. A former colleague paid almost $100K out of pocket for his daughter’s eating disorder treatment.

OP, not sure what the best choice is, but I’m wishing you well.

[Anonymous]

TSP loan only because you "have to" put money back in.

[Anonymous]

TSP loan but try to accelerate payments to payoff in 2-3 years

[Anonymous]

I’ve taken a tsp loan several times, I always pay them off early and I’m paying all of the interest to myself. Really no downside to it except once you have one loan out you can’t take another.

[Anonymous]

Anonymous wrote:I’ve taken a tsp loan several times, I always pay them off early and I’m paying all of the interest to myself. Really no downside to it except once you have one loan out you can’t take another.

Another nice th8ng about TSP loans is that they don’t show up on your credit report

[Anonymous]

Repaying TSP loan with after tax money so you are effectively paying more back. Assuming not a Roth.