Trump’s 401(k) plan tries to fix housing crisis. It's a full-blown retirement disaster

Trump's housing proposal allows 401(k) withdrawals for down payments, but it could cost retirees $300,000 to $400,000 while making homes more expensive.

Using retirement money to buy a home concentrates risk instead of spreading it. You’re tying your future financial security to one asset in one location at one moment in time. Ted Jenkin is president of Exit Stage Left Advisors and partner at Exit Wealth.

I understand the intent. Housing affordability is stretched. Home prices are near all-time highs. Mortgage rates are still hovering around 6%. First-time buyers feel locked out. COVID-19 buyers can’t afford to trade up. Politically, this all sounds like a win. 

Financially, it’s a terrible idea, in my view. This is the classic case of robbing Peter to pay Paul and, in this case, Peter is your future self.