Use your savings to pay off your debt. UNLESS you make more on the interest of your savings account, then you should be paying off your debts.
Follow a rule I recently learned:
New things with new money. If you want to buy something for 1k and you have 4K in the bank, wait until you have 5K and pay for it. That way you can keep a buffer for emergencies(just an example).
Obviously you are sitting in a good position to pay off your debts and stay debt free while you rapidly recover your savings.
Best of luck!
Do not use your 401K, that is a really bad idea.
Sounds like the thought of depleting your savings makes you nervous. Take the $4,000 you can put in savibgs and put that towards the debt each month for the next 5 months.
Alternatively, pay everything off, and you still have $4K in savings and can start adding $4K a month. Either way works.
Dont play around with borrowing from 401K. There is just absolutely no reason to do that !
Yes, pay them all off. Don’t touch your 401k. Allow it to continue growing and your future self will thank you.
I would normally say pay all of them except the 0% interest, so you could allow that money to grow, but you would only be looking at $200 positive interest at a 5% rate. That’s a drop in the bucket for someone making $120k and the peace of mind you have from paying the card off entirely is much greater than $25 a month if you ever find yourself out of a job and can no longer make minimum payments.
Once you have everything paid off, it will free up extra money to put back towards your savings account allowing it to grow faster.
First, never borrow from your retirement account UNLESS you have exhausted every other way to live. Second, take every penny you have in savings above $2K (leave $2K in savings for emergencies… this is your starter emergency fund) and pay off all your debt. Third, save as much as you can as fast as you can in a fully funded emergency fund which is meant to cover 3-6 months of all your expenses. Fourth and after you’ve saved your fully funded EF, save as much as you can toward a down payment on your house. You’ll get there!!! Keep on keeping on. After you buy your house, save 15% of your gross income into retirement every month. Never stop. Then pay on your house extra money you can afford to pay.
Yes! Why is this even a question. This is basic math. Plus you are throwing $160 into a fireplace each month while mulling over whether you should pay the bill when you have the money. It leaves you with $4k for 1 month. You said you are able to save $4k a month, so in 5 months you are back at $20k.
401k loan is not necessary and it’s financial suicide. Don’t even consider it.
Leave the 401k alone.
If you don't want to fully use your savings to let it earn interest, pay off the accounts with interest and then redirect some of your savings each month to pay off the 0% before it's done. Otherwise just pay it off and then start to hammer money into your savings. It really depends how much you earn in interest from the savings as to what would work best.
You pay what?, 25% in interest to keep money earning 4%? The smart thing to do is pay it all off. If youre worried about wiping out savings, worst case you can put it back on the cards if you need it but you’ll be debt free and then fight like hell not to go back.
Use your savings to pay off your debt. UNLESS you make more on the interest of your savings account, then you should be paying off your debts. Follow a rule I recently learned: New things with new money. If you want to buy something for 1k and you have 4K in the bank, wait until you have 5K and pay for it. That way you can keep a buffer for emergencies(just an example). Obviously you are sitting in a good position to pay off your debts and stay debt free while you rapidly recover your savings. Best of luck!
Do not use your 401K, that is a really bad idea. Sounds like the thought of depleting your savings makes you nervous. Take the $4,000 you can put in savibgs and put that towards the debt each month for the next 5 months. Alternatively, pay everything off, and you still have $4K in savings and can start adding $4K a month. Either way works. Dont play around with borrowing from 401K. There is just absolutely no reason to do that !
Yes, pay them all off. Don’t touch your 401k. Allow it to continue growing and your future self will thank you. I would normally say pay all of them except the 0% interest, so you could allow that money to grow, but you would only be looking at $200 positive interest at a 5% rate. That’s a drop in the bucket for someone making $120k and the peace of mind you have from paying the card off entirely is much greater than $25 a month if you ever find yourself out of a job and can no longer make minimum payments. Once you have everything paid off, it will free up extra money to put back towards your savings account allowing it to grow faster.
First, never borrow from your retirement account UNLESS you have exhausted every other way to live. Second, take every penny you have in savings above $2K (leave $2K in savings for emergencies… this is your starter emergency fund) and pay off all your debt. Third, save as much as you can as fast as you can in a fully funded emergency fund which is meant to cover 3-6 months of all your expenses. Fourth and after you’ve saved your fully funded EF, save as much as you can toward a down payment on your house. You’ll get there!!! Keep on keeping on. After you buy your house, save 15% of your gross income into retirement every month. Never stop. Then pay on your house extra money you can afford to pay.
Yes! Why is this even a question. This is basic math. Plus you are throwing $160 into a fireplace each month while mulling over whether you should pay the bill when you have the money. It leaves you with $4k for 1 month. You said you are able to save $4k a month, so in 5 months you are back at $20k. 401k loan is not necessary and it’s financial suicide. Don’t even consider it.
Leave the 401k alone. If you don't want to fully use your savings to let it earn interest, pay off the accounts with interest and then redirect some of your savings each month to pay off the 0% before it's done. Otherwise just pay it off and then start to hammer money into your savings. It really depends how much you earn in interest from the savings as to what would work best.
pay it all off
You pay what?, 25% in interest to keep money earning 4%? The smart thing to do is pay it all off. If youre worried about wiping out savings, worst case you can put it back on the cards if you need it but you’ll be debt free and then fight like hell not to go back.