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I am starting a new business. Is it better to get an SBA loan or finance with my 401K rollover to a corp.? |
I am starting a new business. Is it better to get an SBA loan or finance with my 401K rollover to a corp.? If you can get an SBA loan, go for it. With 401K, you have taxes paid on it plus 10% penalty if you withdraw it. If you are fairly young, while you have to pay taxes on a 401k rollover for early withdrawal, you can start an IRA once your business is going. A loan from SBA carries a very low interest rate, but there is a challenge in getting the prospectus the way they want, though there is help available for writing one. Keeping the 401k is good retirement planning, so I would try the SBA first. Loan |
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