<prompt> Human: Retirement account rookie here, looking for some help for my parents...Heres the situation: My parents are both retired 65 64 and have sizable 401k accounts they are not currently living on. Between Social Security and a pension, theyre comfortable. My brother is in need of some cash 20k and my parents want to withdraw money from their 401k to help him out. Over the last year, the 401k account earned 2. From my understanding, they will not be able to take out a 401k loan since they are no longer with the employer that has their 401k plan, correct? Would they be able to open an IRA account and deposit the repayments into that account? If yes, what are the ramifications? If Im thinking this through, they would take a tax hit this year for the 20k distribution and would be limited to adding only up to 5,500yr to the IRA. They would however get a tax deduction for the IRA contributions, correct? If we ignore the risk that my brother might not repay, are there any other things they should consider or be concerned about? Thanks for your help! Assistant: Theyre both old enough to just take a distribution without penalty they would pay taxes on it. I highly doubt they would have the option of taking a loan. In theory they could offset some of the taxes by contributing to an IRA but their current tax rate may be low enough that it doesnt make that much of a difference paying taxes now vs paying taxes on it in 5 or 10 years. Human: Even if theres no advantage to putting it into an IRA, is there any disadvantage in doing so. Whatever rate theyd earn from an IRA is undoubtedly higher than just sticking it in a savings account, no?  <response>: If they take distributions from their 401k, they can put the assets into a taxable investment account once they get the money back. This will get the same return an investment account.The only differences is that earnings will now be taxed. 