Only as a last resort should one touch their retirement savings for anything other than retirement expenses. But, in those cases when you need to tap into your retirement savings, a way to get money out of your retirement account without paying penalty and deferring tax was just made available beginning in 2002, as a result of a tax law change.

Under new law, those with a small business and no employees or only a spouse as an employee can establish Solo-Owner 401(k) plans and take a loan from those plans. The loan from Solo-Owner 401(k) is not treated as a withdrawal. As such it is not subject to tax and 10% penalty for early withdrawal as long as you repay loan on time.

You may see ads promising -

- Self-Liquidating "LOANS!" - Investment Capital Overnight! - Your "LOAN" has been Approved! - BORROW Money And Never Pay Back! - etc.

A self-liquidating "LOAN" is fiction. You will never get a loan that you will never have to pay back from anybody. You need to be very careful when you are presented with opportunity to get "money for nothing!"

A true, self liquidating "LOAN", standing on it's own, is a pipe dream - it's perpetual motion. A loan that pays itself off is of NO benefit to lender - so, Why Would They Do It? The answer is simple - they WON'T!

Con men typically ask for up-front fees to get people a Self-Liquidating Loan. "Your "Loan" Has Been Approved" is their typical ploy. Since there is NO such thing as a Self-Liquidating "Loan" this should be a tip off that all they want is your money and you will never see such a "LOAN"! Remember money MUST come first, and if they can't prove to you how money will come first to create such a transaction, you will lose any money you pay to these con men.

Also beware of con men that do not charge front fees but want to see if you qualify for such a "LOAN", then notifies you later that you have been approved for a "Loan" and want you to pay points, closing costs, advance interest fees, etc.

But there is a way to use this CONCEPT!

In a Self-Liquidating Loan CONCEPT there are no such expenses! The money comes first, then transaction is created using a Roll Account (Compensating Balance)!

A Self-Liquidating loan actually does NOT exist. I know you see several ads in many publications advertising such a loan. There has been a mystique about these loans. Many people believe that to get a so-called Self Liquidating, Loan one only needs to apply and like magic, there it is! A multi-million dollar loan with money pouring out of envelope! Not so - but Self-Liquidating Loan concept is done every day and you can learn how!