Finance and Education

I have seen many money experts and the most intelligent of people trip on this one.... They say do not take a 401K Loan...In my mind 401K loan is one the best sources of funding out there.....Let me explain.   Myths about 401K loan :   1. Double Taxation : You take Pre-Tax Dollars as Loan and Pay in Post-Tax Dollars One of the biggest myths out there.....the way a 401K loan works is you take money from your 401K account (upto 50% of your 401K balance) which is pre-tax money ...and pay back through your after-tax pay-check deductions with interest (typically much lower than any bank loan ..currently 3.75% on Vanguard)....              When ever some one says this to you ....simply ask them when you take a loan from a bank..do you pay in pre-tax or post-tax dollars?...clearly post tax dollars..... If they are not convinced explain it to them this way...lets say you take 10K out of your 401K account as a loan .....

Cash Value (especially Indexed Universal Life) is one of the most talked about Life Insurance products in the insurance industry today and also a big MLM (Multi-level Marketing) operation with a promise to make you a "business owner".  Why do you need to stay away from this ? Read on.... Product Pure Term Insurance Cash Value Insurance Which is better? D escription In Term Life you pay a flat amount per month (premium) for coverage for fixed period of time (10, 15, 20, 25 or 30 years). For Example: You pay $25 per month for a 20 year $500K policy (actual quote for a healthy non-smoking male 28 years of age) In Cash value "insurance and investment" are combined. This comes in a lot of varieties: Whole life, Universal Life, Indexed Universal Life, Variable life , Return of Premium (ROP) Term (yes!!! return of premium term is a cash value policy disguised as term) In every one of these cases...