Should I cash out my 401k to pay off credit card debt?
Monday, January 11th, 2010 at
7:19 pm
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Tagged with: 35 Years • 401k • credit card debt • Debt Management Program • Dmp • Extra Cash • file bankruptcy • File For Bankruptcy • Five Months • Heloc • interest rates • Last Job • Lawns • Living Paycheck To Paycheck • New Job • Part Time Job • Paycheck To Paycheck • Paychecks • Ramen Noodles • Tax Penalties
Filed under: Free Money Saving Tips Debt Relief
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I’m looking at it this way: you’re 26 years ancient, you have a house (how much was your down payment? I hope you don’t have an ARM), you have a job (albeit not a fantastic one from your post), and you have a 401K. The market isn’t fantastic right now and selling your house might hurt you more in the long run, especially because it’s not unheard of for houses to sit on the market for 6 months or more right now. A second job is a necessity as is cutting out anything and everything that is not a necessity, cable, date nights, drinking nights, extra clothing, etc etc. It’s not unheard of for a 26 year ancient (or a 30 year ancient) to not have a 401K at this moment, or to have a scrawny one. While not the wisest go, if it’s the difference between bankruptcy and not, I would say to go for it, but then to make sure you make wise decisions in the future. Bankruptcy will affect you more in 30 years than money in your 401K will.
You mention savings, how much do you have? Would it help with your credit card debt?