I have $183,000. In an investment account that I rolled over from my 401K when I retired. I owe $23,000 in bills. I am wondering if I should withdraw money from my investment account to pay off the bills. I receive $1217/month from pension and $1666/month from Soc Sec. My husband is retired and receives a pension and Soc Sec also. We are not financially strapped, however, I question continuing monthly payment on bills that would take me the next 10 to 15 years to pay off. I am 67 years old. These are my personal bills not my husbands.

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Originally Posted by junleo

I have $183,000. in an investment account that I rolled over from my 401K when I retired. I owe $23,000 in bills. I am wondering if I should withdraw money from my investment account to pay off the bills. I receive $1217/month from pension and $1666/month from Soc Sec. My husband is retired and receives a pension and Soc Sec also. We are not financially strapped, however, I question continuing monthly payment on bills that would take me the next 10 to 15 years to pay off. I am 67 years old. These are my personal bills not my husbands.

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The amount of the annual % of the interest should be considered in your decision. If the interest is a double digit then yes, paying the bills would save you $$ in the long run, however, know that whatever amount you withdraw from your rolled over 401K will incur taxes, which could be equal [more or less] to the acrued interest.

Checking on both tax vs. long range interest will help you make a decision.

Regards,

Irulan

Hi, Junleo,
The other answer you received before this one is very good.
I am 63, retired, and have faced similar issues with my 401K account.
At 67, would paying off this debt give you a better peace of mind? If that would make you feel much better, not oweing anything of this magnitude, then you might consider doing it.
You can call the Plan Administrator of your investment account, and ask what the penalties are (if any) for withdrawing enough to pay off the debt. And, ask what the approx. taxes will be, so you can better make a decision.
Sooner or later, taxes will be taken out, depending on when you start withdrawing the money.
I am not a CPA, or a Professional. But, just personally, I would withdraw the money and pay off the debt, getting it "out of the way", so I can have the peace of mind that I don't owe that much money to anyone. Again, that is just my own personal feelings.
I do wish you the best, and you are blessed with the income you have now from pensions and Retirement!