You may be taxed on the amount you pull out, aside from that, that is the major consequence

A great option for you would be to roll your 401k money in to a self-directed 401k. This type of account allows your retirement account to invest in any business you want without penalties. Even your own business. At the same time you can work in the business, pay yourself a salary and grow your retirement funds doing something you know and have control over. A Self Directed IRA avoids penalties and allows you to invest in many things including real estate, businesses, and other alternative investments. Land banking is a great alternative investment for self-directed IRAs. The Self Directed IRA is a unique option for those who are tired of loosing retirement money in the market with the limited options their plan offers. You can invest in just about anything, except for life insurance contracts and collectibles, as long as it is not what is called a "prohibited transaction" meaning that the investment cannot be for your personal use, but must be a true investment, and cannot be with certain people or "relatives". A bank loan can be utilized in conjunction with the self-directed IRA, which adds a few complexities to the purchase. Or you could pool your money with other investors to make the purchase. My company specializes in providing this alternative investment option, so contact me if you are interested in finding out more about it. 360-802-0808