Until now, I was pretty much convinced that rather than rolling over the 401k from my old company to the new company, it is a much better option to roll everything over to a Rollover IRA, and my pointers for this belief were below:
- I can invest in my favorite Vanguard Index fund now
- Everything is centralized irrespective of what number of jobs I change
However, I am not a homeowner, and I am thinking about buying a house in the near future. I know that an IRA does not allow a loan against it, while a 401k does. Given the fact that I am not planning for a major loan except the house and I think that would be the biggest loan if not the only one I have in the future, how should I factor this into my decision?
Would it be a correct statement to say that one should put money in a 401k until its time to borrow for a home loan, and then an IRA becomes a better option?