MEGAN MCARDLE: More Reasons to Shun 401(k) Loans. “In general, the point at which you’re kiting debt–using home equity or the 401(k) to pay off credit cards or bad car loans–is the point at which you are in serious financial trouble. While transforming the debt to lower-interest rate forms can seem like salvation, it’s not the answer. For one thing, the lower interest rates come with greater risk–of losing the house or your retirement savings, rather than your credit rating. For another, it won’t work unless you get serious about controlling your money. I’ve watched colleagues do it (not at the Atlantic), and invariably after they refinanced the house, the credit card debt started to creep up again. Many financial counselors and personal finance gurus say the same thing.”