Participants in the plan can borrow against their retirement accounts. In general, the loan program follows the basic guidelines established by the Internal Revenue Service for such programs. The minimum loan amount is $1,000 while the maximum loan can not exceed $50,000 or one-half of the Participant’s account balance, whichever is less. In addition, the loan must be repaid by monthly bank drafts within five years. Participants who are drawing out of their accounts by monthly installment payments are not allowed to apply for a loan.
The interest rate for the Participant loans will be fixed for the life of the loan at 7%. (See page 26 of our Summary Plan Document for more details)
While a Participant loan will not be a wise financial move for some participants, for others it will eliminate the need for a hardship withdrawal and the tax consequences that comes with such a move.
To obtain more information about the Participant loan program, you may contact us by calling the toll-free number 877-767-7738 or by email at [email protected].