|Taking a 401(k) loan|
There are some good reasons to take a loan from your 401(k) -- for instance, when you have absolutely no other options and the repo men are on their way to your house.
Other reasons may just be elaborate rationalizations.
People justify to themselves why they're taking the loan by saying, 'I'm paying myself back.' You're not making back all the interest. There are administrative costs and fees that come out of the interest.
How to recover: Recovering from a 401(k) loan takes time. Pay back your loan and save for the next big purchase or fund an emergency savings account rather than falling back on money that should be untouchable.
Savings accounts are too accessible for the average American today. My suggestion and solution is create an account that is not accessible at your local bank or ATM and then save systematically on a monthly basis.