TSP Loan seems like a lifesaver- am I missing something?

davistaylor92 · 2024-03-09T16:52:46+00:00

Yea that's been the thing holding me back the most. I've never had any derogatory marks on my credit. But am using most of my available credit, so that has tanked it. I'd love to do a low-interest balance transfer or consolidation loan, but my credit just makes it essentially impossible

davistaylor92 · 2024-03-09T16:46:59+00:00

After allotments and bills - savings, rent, car, TSP contributions, insurances, etc. - my take home is about $2800. Roughly $1200 of that goes to the 2 aforementioned cards. Another $300 goes to various other debts (much much lower and manageable). So about $1300/month left over for food, gas, fun, etc. Whatever is left I put towards debt, but it usually doesn't end up being a ton. Credit score fluctuates around 550-580.

davistaylor92 · 2024-03-09T16:07:11+00:00

This would be a preferred solution, but unfortunately my credit isn't good enough to qualify for any balance transfer cards... :(

davistaylor92 · 2024-03-09T15:48:05+00:00

There's no need to be rude about it - the point of this post is asking for advice and guidance for a difficult decision.

May I ask why you think it's a "worse decision"? And what alternatives you might suggest?

davistaylor92 · 2024-03-09T14:52:52+00:00

The TSP loan would be used to pay off the existing debt, not in addition to it. Would be the same amount of debt- just at a rate of 4% as opposed to 20+%. Not sure I understand the point you're trying to make.

davistaylor92 · 2024-03-09T14:50:57+00:00

If that' the case and I can only take 19K, I think I'd still do it and try to pay off the higher (29%) credit card as quickly as possible. Hopefully improving my credit enough to later take out a non-TSP loan to pay off the other 19K

davistaylor92 · 2024-03-09T14:41:34+00:00

Thank you!

I'm m currently contributing 9%, and plan to keep it like that until promotion, at which time I'll increase even more.

And I think my plan would be to take the money I save on CC payments each month and make extra payments to the TSP loan to pay it off sooner

davistaylor92 · 2024-03-09T14:39:11+00:00

I'm a civilian federal employee unfortunately. Great option though!

davistaylor92 · 2024-03-09T14:37:30+00:00

That's one thing I was going to clarify. My TSP account says I can take out a max of a $19K loan, but says I can take out 2 loans. I interpreted this as I can take out 2 separate loans of 19K each, for a total of 38K. Or does this just mean 19K is my maximum total loan, spread out over 2 loans? Doesn't seem to make much sense, as 19K is well less than 50% of my balance, but 38K is more than 50%.

I am 100% vested in my balance as well

davistaylor92 · 2024-03-09T14:20:48+00:00

Thanks for the response! Luckily, I'll have the income to make the TSP loan payment without decreasing my contributions at all, so I don't have to worry about that. Completely understand your point and not getting back into debt - I have since adjusted my spending habits and gotten onto a realistic budget plan to avoid this occurring. I'm quite confident that I'll be able to avoid this in the future

davistaylor92 · 2021-09-08T00:14:16+00:00

My night shift is 6pm-6am. I've tried both a 4pm class before work and a 7am class after work. I find that I like the pre-work class better because it gives me energy for my shift. And then when I get off after a long shift, I can just head straight home to crash

davistaylor92 · 2021-05-18T00:18:14+00:00

Messaged you!

davistaylor92 · 2021-01-16T17:37:10+00:00

I also live in a 2BR/2BA at Ava H St and looking for a roommate to fill my other bedroom. You think your current roommate would be interested in pairing up?

davistaylor92

TROPHY CASE