Financial Advise???

[Mugen910]

I am no finance guru but why not just ask the CC company to lower your interest rate or threaten them that you'll transfer the balance to another card that is offering better? I'm not a fan of taking from a 401k for some reason.

[madurolover]

Originally Posted by Mugen910

I am no finance guru but why not just ask the CC company to lower your interest rate or threaten them that you'll transfer the balance to another card that is offering better? I'm not a fan of taking from a 401k for some reason.

The CC company just sent a letter saying they are rasing the interest rate. That is the reason she wants to get it payed down. She does not care to pay it off in full. That way she can still make a minimal monthly payment and it helps toward her credit rating.

[jkim05]

Originally Posted by madurolover

The CC company just sent a letter saying they are rasing the interest rate. That is the reason she wants to get it payed down. She does not care to pay it off in full. That way she can still make a minimal monthly payment and it helps toward her credit rating.

Well, without more information about her income, age, other assets/liabilities, etc, I can't give specific recommendations, but in general, you should avoid pulling out of your 401(k) for any reason. Also, you don't need to maintain a balance in order to improve your credit rating, merely having the account open with credit available and in good standing is enough. Another consideration is one of Obama's campaign promises was to suspend 401(k) withdrawal penalties, in which case it might work out to pull the money out. My suggestion would be to only pull it out if you are planning on putting the money right back in, and I think the best thing to do would be to transfer the balance to another card, at least as much as possible. Go online and search for 0% or low apr balance transfer offers and see what you can get.