Q: What are the consequences of using 401k money to purchase real estate. We are 62 years old and both still working with no plans for retirement.
A: Thanks for your question…we get this one from time to time. If you pull your money out of a 401k or IRA you will have to pay income taxes on the distribution. However, you can use your IRA to purchase real estate but there are only a few custodians who specialize in this and there are special rules that you need to abide by. PENSCO is a company that many people tend to use for this type of transaction. I suggest giving them a call to discuss your situation and see if it makes sense.