I went back to school after a few years in industry. The PhD has a stipend, but it doesn't quite go far enough. I'm dipping into savings each month. I'm looking for a little extra cushion. I have a 401k that I can dip into. I realize that comes with a 10% penalty, but my marginal tax rate is so low that the penalty doesn't look that big. Alternatively, I can get a student loan, but rates are ~8%, and for grad students interest starts accruing as soon as the loan is given. I'm probably over two years away from being able to start paying it back. So, what would the better option be? (Or maybe there are better ones out there? e.g 0% intro rate credit card)
The penalty is 10% regardless of the tax. If your marginal rate is so low, I'd consider converting some to Roth each year, and not touching it for tuition.