IF one year ago today
And paid off Oct 12, When QQQ is sitting down 30% ytd.
I’m not understanding how this would have been a bad idea, as I had the cash to pay loan plus any interest early.
My premise was that I sold all my stocks near peak suspecting a decent market crash after the pretty silly looking run up. No rocket science just looking at reversion to mean. Draw a line to where indexes would have been without the covid crash and subsequent bubble.
At the same time I’d planned to take the max 401k loan of 40k at 6% interest or whatever it was and use that to “sell” a portion of the portfolio to buy back in later, but without penalties or capital gains.
You could say it was “timing the market” but that was already my thesis for dumping all stocks. I’d considered rebalancing but didn’t think bonds would do much better and wasn’t worth complicated taxes with capital gains.
Ultimately I did not take the loan as I didn’t really need more cash, had no large planned upcoming purchases and got rather distracted with other life events.
Is there something I’m missing where in that time frame this would have ended up being a terrible idea?
Seems to me that would have netting ~10k in my portfolio and if stocks rebounded from here about 20k.
https://www.investopedia.com/articles/retirement/08/borrow-from-401k-loan.asp
