Shughart
DIS Veteran
- Joined
- Apr 13, 2013
Okay. Talk me into or out of this.
I want to take $4500 of my Roth IRA contributions out to pay off my remaining CC debt, and then increase my Roth IRA contributions to $500 from $100/month immediately.
I need the cc debt to be wiped out for my mental well being. I hate having it hanging over us.
Here's the deal. My Roth IRA had a NEGATIVE return last year (-2%). It is currently losing me money. My debt is at 0% (most of it) and I have a balance of around $1k on a cc with a 14.9% interest rate. I don't have much in there. Just about $8k at the moment. This account is pretty low priority, to be honest. We will have a nice pension at retirement that is guaranteed (military pension) and my husband has a quite large TSP balance that we continue to fund using 7% of his income (no matching for his military branch, unfortunately). My Roth IRA will be "fun money" or we will just continue to let it grow and it will become part of our children's future inheritance.
I mean, the money will be replaced in 9 months time anyway. I feel much better about having my Roth IRA contributions be $500/month instead of putting $500/month towards debt payment for the next 5 months. Mentally, it is a more positive thing to see the $500 going towards that. Seeing how the market currently is, I'm not going to miss out on too much growth of that small amount of money, right?
Should I just do it?
Will you incur any fees by pulling the money out? Realistically how long would it take you to pay off the balance if you kept paying on the CC debt otherwise?
Given the fact that it's affecting your mental health (it does mine too, that's why I'm here too!) and you are not relying on this as your primary retirement, but you still plan on replacing it anyways I would go ahead and do it anyways. Even if you take a small hit with fees, it's important to consider your well being into your financial health.