I have an old 403B plan, I am 47 years old and would like to convert part of it to a Roth. I would like to convert $100k to the Roth, but will then have to pay taxes on the conversion. Lets just say $25K in taxes on the 100K conversion. Can I just take a loan from my existing 401K plan (for $25K) to pay the taxes, and pay the loan back over time.
The 401k has a value of about $1.1M and the loan will take 2.1 years to pay off.
I realize I will lose the time in the market and potential gain on this 25K loan, but is this a terrible decision? I feel that the 18 years of growth then ultimate tax free income at retirement will be worth it. Am I way off on this or am I missing something?