Suze Orman Right For Once
Ms. CNBC is full of nonsense sometimes, such as when she shits on annuities for no due cause. Other times, she nails it on the head -- as she did this morning -- when she suggested you NEVER break into your nest egg
401k/IRA to pay the tax bill.
Many 401(k) and 403(b) employer-sponsored plans have provisions that allow you to borrow your own money and pay it back to yourself without penalty. The interest rate is usually low. You can't borrow against your IRA, but you can withdraw the money and use it for 60 days without penalty as long as you redeposit it into the same or a new IRA account. If the money doesn't find its way back into an IRA account within the 60-day period, it will be subject to taxes and penalties. You can only use this 60-day provision once a year. The clock starts ticking on the date you receive the distribution.
The better alternative is to take out a nice
whole life policy -- if you can afford one -- and borrow against it tax free and penalty free. Breaking into an IRA for 60 days is ridiculous. If liquidity is your main concern, a safe
CD from the bank is the best path...
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