We lost $8,000, and it was no problem. (part 1)

We lost $8,000, and it was no problem.

(Megan, this is the story that we said we’d tell you later, because we didn’t want you to worry. (; )

The original plan was that we’d pay off my 401(k) loan of $22,500 and take out a new loan for $30,500. We’d end up with $8000 more than we started with, pay off the nice folks who loaned us the $22,500, and split the $8000 by giving $5000 to Marty and investing $3000 in the Usual Error Project. The person I talked to at The Hartford assured me that this plan would work flawlessly.

It didn’t.

There’s an IRS regulation that you can only borrow $50k from your 401(k) in a 12-month period. Since the original amount of the loan was $27k, that meant that I could only borrow $23k. I had gone through all this rigamarole and asking friends for favors just to put a bunch of money in a box and then take it back out. My interest rate (which I pay to myself) went down from 9% to 6%, so that’ll save $120/month, but sheesh, not exactly what we were hoping for.

We had already promised Marty the $5000 so he could quit his job at Kinko’s. He had already put in his notice and was depending on us. Our two friends who spotted us the $22,500 were also depending on us to pay it back within 3 weeks. The Usual Error Project also really needed that $3000 to get it rolling.

I flipped out.

I spent two hours on the phone with various reps and supervisors at The Hartford, verifying that I was screwed. I filed a formal complaint against the rep who had told me that I would definitely be able to take a new loan in the amount of $30,500.

“We are so screwed! We just lost $8000 and there’s nothing we can do to get it back!” I yelped to Kyeli.

…Stay tuned for the exciting conclusion!

Feel clear and confident about your direction in life!

HeartCompass

Do you wish you could follow your heart, but it seems impossible? I can help you find the clarity and courage you need.

In other words, I can help you find your path.