Don't rob your Future for Today

401k box full of paper money

Experts say if you're thinking about robbing your 401(k) to buy a home, don't. They say you should be an adult and save up for a decent down payment.

Michael Smith of Houston's STA Wealth Management says if you want to do this you're probably not ready to buy a home.

"You have to pay that with after tax dollars so, not a good idea, you're basically robbing your future."

Smith says if you want to retire comfortably you need to really work on retirement savings.

"There's better ways to save up for a home without taking money out of what is going to be your retirement; there's penalties."

A recent survey found Americans think the ideal age to buy a house is 28, but that may be too soon for a lot of us.

Smith says you're better off saving for a down payment.

"You should try to find a way to save, put money aside, get to about a 10% to 20% down payment; and you're gonna have to do that by being diligent, having a good budget and just putting money away. But taking from your 401(k) -- not a good idea." 

Smith says stealing from your future will do more harm than good, no matter how much you want to buy a house.

 

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