I thought about that, and I'm sure the term would be much shorter. Would I still need the same information for a personal loan though?

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Honestly a respectable answer but in hindsight you need to remember to save money to pay taxes from money you make. Go to the IRS website and set up a payment plan it's pretty easy if you create an account online

You could get a personal loan rather than a mortgage. But the interest rate will be much higher.

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First of all, 120k at 26 is a great number. More than most people will have. Good job.

I encourage you to use a compound interest calculator and play around with numbers. I would use 7-8% interest to be conservative (using S&P 500 historical avg as a baseline). Find out what your monthly expenses are and what you expect them to be moving forward. Keep in mind that inflation will result in life being more expensive in the future. Use the 4% rule to determine what lump sum of money you need invested to keep things going. Once you reach that number you can stop contributing and let it grow. You have different options - check out CoastFire, FatFire, etc to see what appeals to you.

I guess you're right, no other way around it. I appreciate it.

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Makes sense. I definitely overlooked this point.

Doesn’t matter if it’s in a bank or your dresser.

Just loses value faster in your dresser

A 401k loan isn't a cash out. You're basically taking money out of your target fund or whatever, and loaning it to yourself. Right now 401k loans are charging you 8-10% (prime plus 0-2%). That interest is put back into your 401k account. Make sure your 401k provider does loans, not all do. Are you sure $30k is available as a loan? Maximum amount is 50% of vested balance (or $50k). If you take/qualify for a personal loan, you'll likely be paying the bank probably around 6-12%.

If you leave your job while the loan is active, you'll have a short period to pay it off or you will have to claim it as a 401k disbursement with a 10% penalty plus normal income taxes. What are the chances your job changes in the next few years?

What are your minimum payments? What's the expected pay back period? You can do up to 60 months. A 3 year loan payment is ~$975.

I personally feel that is an idea that you should entertain. If your budget can't properly support paying the debt back in a reasonable amount of time, paying thousands of dollars in interest per year. That seems dumb to me. As mentioned, the reasons for accruing this debt needs to be addressed or you'll likely end up in the same situation. There are solid amounts of speculation that the market is flat overall for the next 2-3 years. It's not the end of the world to pay in 9-10% on the money not active in the market while the loan is active.

thanks for the very useful information.

Okay, so if you are telling the full truth here this is manageable. But you NEED to get spending under control to get out of this hole. Getting on a strict budget and monitoring all non-essential spending should be step 1. Call the IRS and get on a payment plan for that $20k. Then prioritize all debts in order of highest interest rate. You can do this, and likely relatively quickly, but you need to get a handle on your finances.

There's no way you should be in this situation with your salary. Get a handle on things and get out of this, you can do it.

Also I don't think you're paying the 11% on those cards you think you are right now. As interest rates have been raised card providers have been jacking up interest rates as well. You may be paying closer to 18% or higher right now, and considering the balance you hold that's some serious damage. If you have the credit - get yourself into a conventional loan at a lower interest rate with the terms locked in and get the fuck out of that CC debt. That's terrible man I bet that's where most of your money is going - to financiers every month. It looks like you're paying a ton of money in interest every month and you don't have any positive debt to offset that. You could also look into a loan for a basic business such as renting cars on turo or hyrecar or even privately. Or maybe a laundromat or something that will break even this year and begin positive cash flow. I mentioned things that don't require much time or input. Get yourself into enough good debt that it covers your entire bad debt. You don't seem to be moving forward. You seem to be in a state where you're comfortable with how things have been. You're in a really damn good position to move forward though. Start considering that and planning. I know it has nothing to do with this 20k tax bill but you've got a great set up to build on - even being stagnant with debt. Start planning and building my friend! You don't deserve to spend your days working for the future of others.

I think you need to research the cost of the loan versus what you can do with the money that you have saved. For example can you invest in the stock market now and look for a big upturn in the stock market in the lyrics to and therefore make more money than the cost of your loans.

A quality decision needs a little more research and a little pencil work

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Literally could buy a $1,000 bottle of wine every week and still have more than most people with a family of 3. There must be some incredible unnecessary spending going on.

For financial advice: Identify where your tens of thousands of unnecessary spending is

Was going to provide some advice but the math here doesn't add up. Where the hell is OPs money going?!

Sounds like a random piece of trash paper landed on your car. Just find the nearest receptacle and toss it.

Go to a bank. Tell them everything they ask. Provide a boat load of documentation, and they’ll loan you whatever you want.

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Except you can literally put that same money in a savings account now and make more than that

There are contracts out there that make it impossible to pay off a loan too quick? That is crazy!?

Interesting.. Didn't know about the capital gains tax as NRA. Definitely going with taxable brokerage account then. Thanks again for your inputs!

Your financial planner wants you to have the life insurance because he gets a commission on it.

Who is your life insurance beneficiary? You don't mention having any children, or any other people who you support or who depend on your income. If the only person you support is you, you do not need life insurance. Life insurance is so that those people who depend on you can still have a roof over their heads and survive if you die. If you and a partner split a mortgage 50/50, your partner may not be able to keep the house by themselves. In that case, you should have life insurance on each of you to cover each of your halves of the house, so your partner can continue to live there.

Some employers provide minimal life insurance as a benifit. Usually, it's about 1 year of salary. That's plenty for a person with nobody who depends on them. Maybe even overkill, but if the employer includes it at no additional cost to you, take it.