Can I use 401(k) or IRA money for a down payment, and should I?

You can, but weigh it carefully. With a traditional IRA, first-time buyers can withdraw up to $10,000 of earnings penalty-free (you'll still owe income tax), and Roth IRA contributions can always come out tax- and penalty-free, with up to $10,000 of earnings also penalty-free for a first home. A 401(k) loan lets you borrow up to $50,000 or half your vested balance and repay yourself with interest, avoiding taxes if repaid on time — but if you leave your job, the balance often becomes due fast or counts as a taxable distribution. A straight 401(k) withdrawal before 59½ usually triggers income tax plus a 10% penalty, which is expensive. The bigger cost is lost retirement growth. Tapping retirement should be a last resort after exhausting savings and assistance programs. Model the trade-off at wealthserene.com/tools/opportunity-cost.