Looking forward to retirement as a time to start that business you’ve always known youcould run? Be wary of using your retirement money as seed money,lest its pros turn into cons.

According to a NerdWallet report, while there’s a retirement accountoption for launching a business—known as a Rollover for BusinessStartups, or ROBS—there are reasons to be very careful if you takethis route to entrepreneurdom. Says the report, “While this type offinancing can provide you with money to fund your business, thecomplex transaction doesn’t make sense for everyone.”

You can use funds from eligible retirement accounts, including a401(k) or a traditional individual retirement account, to launch abusiness. The accounts get rolled over (usually with help from anattorney or a ROBS provider) so that you can use the funds eitherto invest in a new business or franchise or even buy or put moneyinto an existing business.

A C corporation gets formed, along with a new 401(k) plan forthe business, and then the buyer’s existing retirement accounts getrolled over into the new 401(k). Once that’s done, the money in thenew plan is used to buy company stock in the new C corporation sothat the money from the sale of stock is the cash that’s investedin the business.

That allows the new business owner to avoid the necessity ofneeding strong personal credit, positive cash flow and collateralfor loan approval—a means for someone with healthy retirementsavings but maybe no other loan qualifications—to be able to launchthe business.

It’s also not a loan, so there are no loan payments hanging overyour head, meaning that you can reinvest any profits back into thebusiness instead of having to make payments on a loan and loseprofits to interest charges.

In addition, if you take money out of a 401(k) or IRA before youturn 59½, you’ll get slammed with early withdrawal penalties and adistribution tax. But if you take those funds out to get a ROBS,that’s not the case.

Lest you rush off half-cocked to go start that business you’vealways dreamed of, remember the cons: It’s your retirement moneythat’s at risk. If the business fails, you have no retirement.

You’re also foregoing any chance of asset growth within aretirement account; if the business doesn’t grow, you’ll miss outon compounding and any rise in the markets that your 401(k) couldhave taken advantage of.

Also, you’ll have to operate as a C corporation, whether or notthat particular business structure is good for your businesstaxwise—not as a sole proprietorship or a limited liabilitycompany. And you’ll pay—a lot—in fees to pull this off andbe more prone to audit by the IRS.

So before you take the plunge, talk to the experts and make sureit’s what you really want to do.