{"id":70,"date":"2022-02-10T16:09:22","date_gmt":"2022-02-10T16:09:22","guid":{"rendered":"https:\/\/blog.dunawaylawoffice.com\/?p=70"},"modified":"2022-02-10T16:09:22","modified_gmt":"2022-02-10T16:09:22","slug":"should-i-use-retirement-funds-to-pay-off-unsecured-debt","status":"publish","type":"post","link":"https:\/\/blog.dunawaylawoffice.com\/should-i-use-retirement-funds-to-pay-off-unsecured-debt\/","title":{"rendered":"Should I use retirement funds to pay off unsecured debt?"},"content":{"rendered":"
The short answer is NO, unless you have consulted with an attorney that is an expert on debt management and reorganization! Even then, if an attorney recommends that option I suggest getting a second opinion. Individuals can face overwhelming debt for numerous reasons including divorce, job loss, medical emergencies, or emergency home repairs. Faced with mounting debt and the uncertainty that comes with that, many people immediately think of using retirement funds as a quick and easy way out from under their unsecured debt.<\/p>\n
Bankruptcy is the first option individuals should explore as it was specifically designed to give people a fresh financial start and does not typically carry the same fees, penalties, and consequences of raiding retirement funds to pay debt.<\/p>\n
TAXES & PENALTIES <\/strong>– It might be difficult to ignore the lump sum of money sitting idly in your traditional IRA or 401(k) accounts when staring at high interest credit card statements. While there are some exceptions to early withdrawal restrictions, it is wise to remember that early withdrawal of these funds could possibly lead to additional taxes as well as penalties<\/a>.<\/p>\n