Mark Kohler explains how a Solo 401(k) lets you borrow up to $50,000 or 50% of your balance while still working, unlike an IRA. You repay with interest that goes back into the account tax-free, growing your retirement fund.
One of the other benefits I like about the solo 401 is that you can borrow against it. It's not like an IRA where I have to wait till I'm 59 and a half. I can start borrowing against my own 401 for an opportunity or a problem, and I can borrow up to 50% or $50,000, whichever's less. And what's nice about that is you're paying interest back to yourself tax-free. So that interest payment, as you pay back that 401 loan, goes all back into that 401 bucket that continues to grow and snowball. So I love that borrowing provision.
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