Financial restructuring?

A year ago, I closed my business and I'm now working full-time for a company.
My take home salary was reduced 50%.
Just a few weeks ago, my old business debts transferred over to my personal debt.
I used my credits to pay for the loans and increased my credit card debt.
I have Ameriprise and have annuity and a VUL with them which was set up long
before I knew any better.
My gut instinct is to cash these out and pay my credit card debts worth over 40k.
What do you think? comments and suggestions welcome.
thanks.

Capital gains and penalties are not going to be pretty. Do the math yourself, and see if it's a sound economic plan.

I'm assuming your business debt was guaranteed by you personally? Just checking, but was your business a separately chartered LP, LLC, or S-corp or C-corp? Do you have the bank documentation verifying that you are responsible for this debt, or is this in the works from overzealous collection agencies?

If you are on the hook for the debt, and since having paid it off using credit cards and now have high balances, can you refinance the revolving debt with cheaper debt - home equity, promotional 0% apr credit cards, installment plans, while you drill down to see what you can pay down now to lower the debt?

The penalties to cash out your annuity and VUL are stiff. You may be able to borrow from both, but expect a repayment charge. Also, would cashing out totally disrupt your retirement savings plan?

I would check other options first...

Not a good idea. You'll likely loose 50% of the annuity and VUL off the top then you'll still have taxes on it next year.

Best approach it to setup a debt repayment program that avoids bankruptcy and keep your annuity and VUL.

At the same time consider look for ways to earn additonal income to supplement or get you back to or beyond where you were before your income reduction. One such vehicle, is a company called Market America, a 15 year old Product Brokerage and Internet Marketing company. Contact me if you're open to evaluating this opportunity. There may be light at the end of the tunnel.