My ex husbands company doesn't allow me to keep my portion of the 401K in the company. I was told to invest in an IRA. I am 47yr of age and living on a very little income. Can I use part or any of the money to purchase a home. My husband and I did own a home together. But I have never purchased one on my own. I have been renting with roommates since the divorce.

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Originally Posted by DWfemale

My ex husbands company doesn't allow me to keep my portion of the 401K in the company. I was told to invest in an IRA. I am 47yr of age and living on a very little income. Can I use part or any of the money to purchase a home. My husband and I did own a home together. But I have never purchased one on my own. I have been renting with roommates since the divorce.

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If you use money from a 401(k) or traditional IRA to purchase a home, you will be hit with an early withdrawal penalty PLUS have to pay taxes on it immediately. This usually isn't a smart choice. You are much better off borrowing more money. If you have a Roth IRA, you can use that money to purchase a home without receiving penalties or paying taxes.