Rollover Or CC Pay Down?
I am leaving my job for self employment in a couple of weeks. I have two retirement accounts, one through the state with approx 20K which I am going to roll over into another plan. The second account is a 457 with about 9k in it. I have 14k in CC debt that I'm considering using the 457 early withdraw to pay down. I know theres a penalty but this would reduce my cc debt by half. What should I do?
at what cost? calc the penalty and tax, and see if you can paydown 50%
Interest rate is 10%. Penalty is 20% withheld and 10% early withdraw. I'm 28 years old.
According to my calculations, it looks like you will get them down to about 7,700. If you are willing to pay yourself back, then it doesnt seem too bad of an idea. But...you need to consider how much interest you are paying on the credit cards as well. I think that if the interest is sky high (like 18%+), I would consider your option. Talk to a financial advisor first. Its good that you have that other money to roll over too.