How does a 401k loan work? When you take out a 401(k) loan, you act as your own bank. Depending on the rules set by your employer's plan, you can borrow up to half of the money you have saved in that account, but no more than $50,000, within a year. Remember though, you will have to pay back the money you borrowed, along with interest, within five years of taking the loan in most cases. The specific rules of your 401k plan will also determine the maximum number of loans you can have at one time. Oh, and, you might need permission from your spouse or domestic partner to take out a loan. #401kloan #401kwithdrawal #retirementsavings #personalfinancetips