Using 401k Contributions to Buy a Franchise

**dcampbell918** · 09-16-2008 07:20 PM

Did you know that you can start a business and enhance your retirement portfolio at the same time? Buying a franchise with 401k Contributions is another option for entrepreneurs to start a business, and is becoming more common in today’s economic environment.

What do you think about this practice? Risky? Or just the right move?

**rafhelp** · 09-17-2008 08:04 AM

what is 401K contributions?

**aed343** · 09-17-2008 08:21 AM

I would advise against it. In order to do so you would have to take a tax penalty plus wipe out the gains you made.

Let's say that you gained 8% from your 401(k) fund plus the tax penalty, anywhere from 10%-25%, but let's take the average 15% for calculation purposes. That's 23% you're losing.

Would you borrow money from the bank at 23% interest rate? I wouldn't.

Here's my suggestion. Wait. Build up some cash and then take the leap. That time will come, don't worry. Good luck and I hope the info helps.

**mbrand2222** · 09-17-2008 09:29 AM

I agree with Alton. Be safe.

**lifemaker** · 09-19-2008 01:00 PM

Yeah, be safe. And i think there is a better way.

**conductr** · 10-12-2008 11:25 PM

It all depends on how confident you are about the franchise business. Money is money, it doesn't matter if you spend your savings, current income, or debt (future income) to finance it. You shouldn't make the decision based on where the money comes from, but on the opportunity itself.

There are ways around the tax penalties: benetrends.com/ home/index.php (sorry cant pose urls yet)

**FranOption** · 03-09-2010 03:56 PM

actually you can use your 401k and not have a penalty

**FranOption** · 03-09-2010 04:13 PM

check this link out this will show you how to use your 401k with out any trouble the best way out

BeneTrends - ACTION!

**Thomas N** · 08-15-2011 01:33 PM

With 401K, I would suggest even starting a franchise. I had to pay 1.6M for my KFC.

**flickgal** · 11-04-2011 12:35 PM

not a good idea...too risky

**Ann Tse** · 11-06-2011 02:05 AM

Hi, guys

What do you think of a free franchise? You don't have to pay franchise fee, no purchase from franchisor, no need to pay any contibution.

Instead, the company privides you
1. Free Rental
2. Free Renovation
3. Free Utilities
4. Free equipment
5. All goods are on consignment
6. You pick your shop location and the company will rent it on your behalf.

Your Sources of Income
1. Earn certain 10% from customers in US (various according to different countries)
2. Earn up to 24% from members who purchased from your store.
3. Earn up to 15% profit from your direct members even if they purchase from other outlets

The most attractive point is you could also be franchisor to franchise this free shop outlets to your direct members, ie, just to duplicate the biz model. Whatever money generate from those duplicate shop also contribute income to you. The biz is now availalbe in many countries, such as US, UK, Austrailia, New Zealand, Germany, Singapore, Thailand, Burma, Indonesia, HK, Japan, Korea, and up coming to mainland China (forsee to be the biggest market in the world.)

Would like to learn more, please send me your private email so that could forward you more details and some image shop photos for your reference.