Two years ago this June I took a small loan out of my 401k to pay down some bills (like $1300 I think). It felt much easier to pay that back via my paycheck on a schedule I choose than to pay whatever bill it was (I forget what it went towards exactly). The payments I setup were only about $27 per paycheck (every 2 weeks).

It seemed easier this way because that money would never even see my bank account. So I had no way to spend it. Not to mention a 401k loan doesn't show up on my credit report. And did I mention as I repay the loan, I pay myself (or my 401k) interest? It's only like 6% or something I think, but I probably make out better than the market this way!

Well I was finally able to pay it off this week (a couple payments early even). Jen helped me a bit with the early repayment but I just wanted to get it done as soon as I could. That extra $50+ per month will come in handy - especially through the summer.

The question I'm asking myself now is, do I take another loan to pay another bill that way? It would be nice to have another credit card paid off - even if I'm paying it through another channel. In reality it should work out slightly better because I'd be paying a little less than what I am now and my credit report would show it as paid - also helping my credit score.

The biggest part holding me back is if I do this, it likely means 3 years of payments (or whatever I choose for it to be). I want to believe I have that kind of job security, but who knows these days, right? Don't get me wrong, I don't know of anywhere that I'd be going - but you just never know.

So what do you think? Get credit cards paid off through my paycheck (in a round-about way) or just suck it up and keep paying and leave the 401k alone?

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