<prompt> Human: Hi! My name is Chris. Im a 25 year old making 50kyr and have I have no debt and have maxed out my Roth IRA. I currently have about 20k in my checking account. I would like to maintain an emergency fund of 15k and leave the other five in my checking as a buffer for every day expenses, small emergencies, and fun money. This 5k, could carry me for a few months if I lose my job and cant access the 15k from my 401k. What would be the downside to investing this 15k emergency fund money into a 401k? I feel that the best case scenario is that I never need the money and Ive made a huge contribution to my retirement fund, especially this early in the game. I feel the likely worst case scenario is that I lose my job and after a year and a half Ive eaten through my emergency fund and forced to lower my standards for employment and just get a job. Even if Im making half of what I currently make, Ill still want to replenish my emergency fund regardless of whether the money was taken out of a 401k or a bank account. So why not make some gains on that money until I need to withdraw if I ever do And if I do, I can slowly pay back into it penalty free. I feel like this is a good idea; am I missing something? Is there more to borrowing from your 401k that I dont know about?  <response>: Because you cant have an outstanding 401k loan after you lose your job - you usually have 60 or 90 days to pay it back in full, otherwise its a distribution and you get hit with the 10 penalty.Taking out a 401k loan is bad enough when you have a job - if you dont have the job it makes no sense. If you want to get tax-free gains on earnings from your emergency fund, then just use the Roth IRA, because contributions can be taken out tax and penalty-free at any time and for any reason. 