You most certainly have a right to your opinion. And, of course, most likely nobody here can claim expertise.
But it's not about what the market is going to do in the next 5 years. When one borrows from their 401(k), they are losing the power of compounding interest over the next 30 - 40 years on the money lost. Yes, the market rises and falls in cycles. Yes, it's not predictable within those cycles. But over 150 years of data says that over the long haul, the stock market rises on average about 11% annualized and that if you pick solid investments, that's about the rate of return (before taxes) that you can realistically expect after 30 years. By borrowing $5000 now, you are in fact, borrowing nearly $50,000 of your future retirement. It may be harder to come up with some creative ways of paying down consumer debt, but the writing on the wall says "Don't borrow from retirement unless it's something like a medical emergency." I really wish the OP would look for other alternatives. The problem is that you don't see the effects of this loan for years and years, so it seems like such a good idea now. NOW, when you're young, life is a lot more flexible. Once you're retired, you can't "borrow" to live.
As for the advice about not borrowing in a HELOC. I most definitely disagree. You can usually get lower interest rates than you would borrowing from your 401(k), the terms are extremely flexible, there is no threat if you lose your job that you would have to repay it, and if you itemize on your taxes, it's a great boon for your tax return. I also think that paying off your mortgage is a VERY INDIVIDUAL financial decision that needs to be evaluated on a case-by-case basis. It depends on your current investments, your marginal tax rate, and stability of your income. We could pay off our mortgage right now, but choose not to. We have a really low rate, we itemize on our taxes and our investments are gaining us about 2.5% over our mortgage right now. We'd be fools to pay it off. We carry a mortgage BY CHOICE.
Finally, I don't see peak oil (as a single contributing factor) as heavily correlated to the world markets. Yeah, it can affect a country's ECONOMY, but so can GDP, personal spending, consumer price index, unemployment and many other economnic forces. That's the point of asset allocation. If you have a well-diversified portfolio, while one area might not be growing, you are invested in areas that do grow - it's not gambling, it's PLANNING. Right now my domestic funds aren't doing so hot, but my international funds are AMAZING! As inflation stabilizes, my bond funds are doing okay, too. A diversified portfolio is always going to grow over time. I have 100% faith in that. I have watched our portfolio grow for the past 20 years (both tax-advantaged retirement/college savings accounts and taxable accounts). I just think it's bad advice to tell someone to stay away from investments. I bet Warrent Buffet is glad he didn't.
Like I said, of course you have a right to your opinion. I just don't agree with it.
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