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 only if you have a financial hardship. 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