In terms of borrowing from your Thrift Coupons Plan (TSP), providing that loan is going to be a stylish alternative. Permits one accessibility retirement deals and you will shell out yourself back which have desire. Although not, what are the results if you cannot pay back the borrowed funds? Defaulting to the a tsp financing may have severe consequences that may feeling your retirement offers. In this point, we will speak about the risks away from perhaps not paying a teaspoon financing.

step one. Income tax implications: For folks who default to the a teaspoon loan, the fresh outstanding balance is a shipping from the account. It means it is possible to are obligated to pay taxation to your number of the loan, along with any attention which is accrued.

dos. early withdrawal charges: Together with taxation, additionally be subject to early detachment penalties if you are around years 59 . Read More >