Can I use my 401k to buy a home?

Yes, you can use funds from your 401k to buy a home. You may take a loan from your 401k (up to $50,000 or half the vested balance) that you repay with interest, or take a hardship withdrawal if your plan allows. Withdrawals before age 59.5 incur a 10 percent penalty plus income taxes, though first-time homebuyer withdrawals up to $10,000 in earnings may avoid the penalty. Check with your plan administrator and tax advisor before making any moves.