investment/money ?

[wally]

Okay with the way things are right now can someone ejumicate me on why I should not take money from my 401k and pay off some bills? I know I have to pay it back but unless I am missing something the interest I pay back is going back to my account? I also know if I do it i need to cut the cards and close the accounts so I do not get back to the same postion. Just something I am thinking about and figured with as many people on here I sure to get some opinions. Thanks

 

[RockMonkey]

"The way things are right now" is why you shouldn't take any money out of your 401k. We are in an economic recovery and the stock market is reflecting that. It's bouncing off historic lows, and making incredible gains right now. The Dow is up 30% since early March. Don't take your money out of the market after you just lost a buch of it and it's just starting to recover! The only way I'd take money out of any of my retirement accounts is to avoid losing my home. If that's the situation you're in, and you can avoid losing your home (not just delay it for a while), then I would do it. Otherwise I would budget my money very carefully and pay off bills with my income.

 

[ID Bronco]

I am a believer that you should do all you can to be as debt free as possible. Yes, save for retirement, but depending on how bad the debt is I would pay it off. There are a lot of variables though.

 

[MR.CJ-7]

I guess if your credit card bills and interest is hurting you more than long term saving in the 401k will help then pull it out. But I agree with rockmonkey. Keep that money in...in fact, put more in. Put in the max that your company will match. Remember...buy low, sell high!

 

[OREGON85]

I wouldn't save a penny if I had credit card debt. I probably wouldn't liquidate my 401k either though. Credit card interest is really high, so I would work really hard to kill that debt then use the same money from your budget to save for retirement once the credit card debt it gone. I highly recommend Dave Ramsey's book The Total Money Makeover.

http://www.google.com/products/catalog?hl=en&q=the+total+money+makeover&um=1&ie=UTF-8&cid=14516424100032556471&ei=aJIDSpajEpnqtAP2yJ3YAQ&sa=X&oi=product_catalog_result&ct=result&resnum=1#ps-sellers

 

[Cody]

I'm pretty tight on funds right now. As a last resort I have reduced my 401k contribution to 1% (from 6%). I hated doing it, but until I can sell my house I need every last penny to stay afloat. I'm going to refinance my jeep to get $1500 to finish my yard and then use whatever's left to help me make my mortgage while the thing is on the market. If it stays on the market, then I have a small 401k (like $1000) in a rollover account that is seperate from my main 401k that I'll cash out to supplement my payments for a couple months.

I'm to the point where I just dream about what I could do with the extra $1500 per month I'm spending on my house right now. I got a little greedy and ended up buying a house I didn't want to live in longer than a couple years just so I could get in on the bubble, and then it burst a couple months later. I'm pretty sure I can get out from it without losing anything but the labor I put into it, but next time I'll make a house purchase with a better long term plan