Essay About 401k

Decent Essays
Taking money out of your 401k to pay your credit cards is a truly terrible idea. It is officially the stupidest thing you can do. Your 401k is your best saving tool for when you retire. When you are 65yrs old, there is a good chance you will have absolutely no earning power. At that point you are going to have to rely on the state (those things that sometimes go bust!), and you are going to have to rely on your retirement savings. Draw out a little when you are below 60, and you remove a large sum you could have used as security when you are older.

H3 Using Your 401k To Pay Off Your Credit Card Debt Is Dumb

Of all the frivolous reasons to draw money out of your 401k, drawing it out to pay off your credit card debt is probably the worst.
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If you cannot pay off your credit card debt, then you cannot afford a mortgage and you cannot afford to pay for a house. You need to learn how to handle your money before you take on mortgage debt.

H3 Your Problem Is That You Keep Spending

Credit card debt is a bottomless pit of debt because people keep spending the money they on their credit card. They find themselves in trouble every now and again, and they keep spending the money they pay off their credit card. They max out their card, they slowly build $300 or $400 of credit on it and then they spend it for one reason or another.

H3 Cancel Your Credit Card As Soon As It Is Paid Off

If you do not do this, then you will always be at the mercy of credit card debt. If you have ever maxed out your credit card and had it maxed out for months, then you are simply not good enough at handling your money and your debt to keep your credit cards. When you pay off your cards, you need to cancel them and never touch them again. Does doing this justify using your 401k? Not on your life it doesn’t. You need to pay off your debt the hard way if you are ever going to learn how to save, build wealth, and stay out of credit card
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