RRSP/401K Withdrawl to cut CC debt

Is it wise to dip into one’s RRSP/401k to pay down credit card debt.

I was planning to withdraw some money to pay the credit cards down. Once they were down I was then planning to aggressively deposit back into the Retirement pot.

Is this wise??

I would not do it. Your 401K is for your retirement needs. If you dip in it for consumer debt it becomes a slipper slope. Additionally, you may be subject to some penalties for doing so. I would just keep cutting back on expenses and paying down your lowest credit card, then go to the next one as you get excited.

Debt sucks but learn from it and persevere

First of all, don’t lose heart. Debt sucks but learn from it and persevere. You can do it.

The rule of thumb is to pay off the highest interest debt first; however, this ignores human behavior. I would suggest that you pay off the lowest balance credit card first. Still try and make minimum payments. When you pay off the first one, you will likely feel a sense of accomplishment that you can do it. Then go to the next one and knock it out.

Only use your credit card as a last ditch effort to get something you need (food and shelter) not something you want.

That’s what I’m doing… I know Target is lower interest than most, because I owe the least on it. But it frees up the cash for the next to bigger debts. Barclaycard is totally in my crosshairs now. I want to pay Target off, but their charges are about six bucks. So, In this case I am actually socking it to Barclaycard more.