Quote:
Originally Posted by Scottw
I have been in finance for 13 years and I would advise against taking 401 (K) money out to pay bills especially since you are probably not back up at the level that your 401 was at a year ago thanks to the market. You would be selling a depreciated asset (maybe even at a loss), paying income tax plus a 10% tax penalty (assuming you are under 59 1/2) to pay off a credit card. I would call the CC companies or send them a certified letter that includes the compelling reasons why you cannot maintain your payments to them and see if they can lower the rate. Keep your retirment money until retirement.
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The credit card companies are much more willing to work with you than they act. Not only that but make sre everything else has been done first. Is they anything that can be sold to make some cash to pay it off? A yard sale or something? Do whatever you can to not borrow from the 401k...you will thank yourself later
