Beshears, JohnChoi, James JLaibson, DavidMadrian, Brigitte2011-07-202011Beshears, John, James J. Choi, David Laibson, and Brigitte C. Madrian. 2011. The Availability and Utilization of 401(k) Loans. HKS Faculty Research Working Paper Series RWP11-023, John F. Kennedy School of Government, Harvard Universityhttp://nrs.harvard.edu/urn-3:HUL.InstRepos:5027953We document the loan provisions in 401(k) savings plans and how participants use 401(k) loans. Although only about 22% of savings plan participants who are allowed to borrow from their 401(k) have such a loan at any given point in time, almost half had used a 401(k) loan over a longer, seven-year horizon. The probability of having a loan follows a hump-shaped pattern with respect to age, job tenure, account balance, and salary, but conditional on having a loan, loan size as a fraction of 401(k) balances declines with respect to these variables. Participants are less likely to use loans in plans that charge a higher interest rate, and loans are smaller when plans allow fewer simultaneously outstanding loans, impose a shorter maximum possible loan duration, or charge a lower interest rate.en-USMBG - Markets, Business, and GovernmentFinanceLabor Economics401(K) LoansResearch Paper or Report2011-07-20