Can I take a loan out for any reason?

  1. Some plans allow you to take a loan for any purpose—even imprudent ones!
  2. Some plans restrict your ability to borrow money from the plan to only include financial hardships. Most plans use the IRS’ definition of financial hardship to include:
    1. Funds to avoid foreclosure or eviction
    2. Medical expenses not covered by insurance
    3. Funeral expenses
    4. Home purchase
    5. Post-secondary education expenses