Mark Kohler explains how to borrow from a Solo 401(k): you can take up to 50% of your balance or $50,000, whichever is less, and repay the interest to yourself tax-free. IRAs don't allow this, making the Solo 401(k) a more flexible retirement account option.
One of the other benefits I like about the Solo 401k 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 401k 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 401k loan, goes all back into that 401k bucket that continues to grow and snowball. So I love that borrowing provision.
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