Hello /biz/ folks!
I've been sitting down with my finances over the last few days and i was curious abo paying off my debt in different ways.
32yr old firefighter living in dc area.
I have about $15,000 in credit card debt with a 16.5% interest
~30,000 in car payment
And a mortgage of around 230,000.
I have 27,000 in a Roth IRA
70,000 in my 457 deferred comp plan from work.
I also have a pension that'll offer me my salary equivalent after retirement.
I project that I'll earn around 100,000 - 110,00 in total earnings this year.
What I'd like to do is pay off that credit card debt as fast as possible.
Besides working myself to death to earn more money faster, I was considering doing a few things:
Devoting my tax return to credit payoff ~4-5,000
Tapping into my Roth contributions to payoff te credit card
Reducing my tax exemptions to zero and getting a few heavy paycheck a to knock down the credit card bill.
Suggestions or opinions?
I've already tightened up and can stick to my monthly budgets but I want this card paid off as fast as possible because finance charges are bonkers. @ ~150.
I know using savings to payoff credit is kind of frowned upon. I'm 32yrs old and have another 25-30 years of work ahead of me.
I bought a new home and the majority of the costs were furnishing related.
Plus, a six figure income (barely) in this area isn't exactly the lavish lifestyle.
But the point is I'm a fucking moron and now I'm paying it off.
Cool with taking contributions from the Roth plus the tax return to buy off the debt?
> I'm 32yrs old and have another 25-30 years of work ahead of me.
> I'm heavily in debt, can barely afford my lifestyle, get my salary and lofty retirement plan paid entirely by tax payers, but the reason I'm poor is illegal Mexicans, Trump 2016
well that makes a lot more sense than just firefighting.
you know what to do, minimize expenses and live tight for a few months and pay off that debt.
who said "using savings to payoff credit is frowned upon"? you'd get a guaranteed 16.5% return by paying off that debt. IRA returns at this point? sure as hell aint guaranteed.
tax return = 4k
IRA = 6k
tightening up a bit = remaining 5k
you can do it.
>15k cc debt
>30k car payment
jesus christ, you dun goofed from the beginning. just because you can get the credit for it doesnt mean you should.
let me guess, you also have the newest iPhone, huh?
wagecucks gunna cuck
also, you should be out of debt before you start saving anything. whats the point of saving money if you owe people money?
>get debt free
you shouldn't do it in any other order.
1. Pay off your credit card debt.
2. Pay off that car loan too while you are at it. You don't need to worry about bettering your credit rating as you already have a mortgage.
3. You should have enough money to do 1 and 2 without breaking a sweat. If you can't find it in your budget to do that you need to RADICALLY alter your spending habits. This does not require you to go full poverty by a long shot, but it may feel like it if you somehow spending all that dosh every year.
4. You are not going to be a fire fighter much longer. That is a job that will destroy your body and you are quickly reaching the age you will no longer physically be able to do it. You should be thinking about what other skills you have and transitioning gracefully to a more long term career.
You fucked up bad anon, but you have a good salary (for now) so you might be able to save yourself but it's going to be a lot harder than carrying people out of a burning building.
For goodness' sake, please don't touch your IRA. In fact, never put less than the max amount into it.
Use your tax returns to pay what you can.
Reducing your tax withholding to pay the rest seems like an okay idea as long as you don't fall into the trap of not saving up enough for the inevitable rape you're gonna get the following tax season.
Best of luck to you, I hope whatever choice you make works out well for you.