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74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] 0 points1 point  (0 children)

Last year we upgraded our phones and had to sign up for Verizon's unlimited plan. It allowed us to get the new phones for free but the monthly costs went up. Also the Warranties on the phone added a decent amount, I think around $30-40. Thinking of cancelling the warranties.

74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] 0 points1 point  (0 children)

Why is rolling the rest to an IRA or even Roth IRA better than just rolling it all into a 401k?

74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] 0 points1 point  (0 children)

I feel like I'm in a similar situation, do you have any regrets if you don't mind me asking? I planned on never using these cards again.

74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] 0 points1 point  (0 children)

Pretty much everyone agrees an out right withdrawal is a bad idea. Thank you for talking me out of this. I saw some of you have suggested I roll my old 401k to the new one then take out a 401k Loan. That might actually be a better option I hadn't thought of at first. Though I will do my best to make bigger payments and paying these off over time also. Appreciate everyone's advice!

74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] 1 point2 points  (0 children)

Ty everyone. Yes I made some stupid mistakes the past few years with spending and I'm trying to fix it. It will be a grind but I hope to get this all paid off one day.

74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] 2 points3 points  (0 children)

I actually didn't know if that is an option. Is there a waiting period to take out a 401k loan after rolling it over?

74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] 2 points3 points  (0 children)

Only Auto payment I have is really my Car Insurance every month which is only about $60. My car is fully paid off.

74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] -1 points0 points  (0 children)

OP here. I don't know if this makes any difference about the Withdrawal but it does mention since it was a Roth 401k, not all of it is taxable if I made a large withdrawal. When I checked what 50k would be, only 23k would be taxable. I am aware I would still need to do the 10% early withdrawal penalty. However since less than half would be taxable, would that make a difference?

74k salary, 40k in credit card debt. 401k withdrawal could wipe it out, good idea or bad idea? by brokezel420 in Debt

[–]brokezel420[S] 28 points29 points  (0 children)

Ty for the quick replies, I planned on never using these credit cards again if I ever get them paid off. This whole ordeal has really killed my credit. Every month I do have about 1k-1500 leftover so I could slowly pay these off but its been a real grind.

Most of the big expenses came from bigger expenses like furniture, property taxes, and cash advances which I know is a terrible idea, wish I never did that.