Pay off credit card debt with ROTH IRA monies?

I have some credit card debt hanging over my head...most of it is from when i was unemployed a few years back. needed to use it for basics like groceries and rent (had no alternative).

i've negotiated my interest rates as low as the companies are willing to go and have good credit. however, the interest rates are still pretty high, so i'm getting reamed in the long run with finance charges. i want to pay at least one of the two cards off and close the account.

this debt is causing me stress, I can only afford to pay the min. payment each month and want to have more disposable income and money for my 401k deduction and savings account.

Any thoughts on using my ROTH IRA to pay off the debt? It will take nearly all of my IRA to cover the debt, so that's the big concern. However, i'm confident i'll be able to replenish it from other sources over the next few years.

FYI, I'm 34 in case that's a question in terms of retirement timing.

Anyone do this and have any regrets? Thx!

As a side note, i'm not in dire straits, so there's no need to sell my belongings or cancel my cable TV or cell phone service. I do okay...i just want to reduce my debt.

I wouldn't do it man! That money is for a specific purpose. Unless it's a dire emergency leave it there for that purpose. You said you are confident that you can replenish that money from other sources. Use those sources to pay off the debt instead. The time will pass and the debts will eventually go away. If you want to build real wealth you have to keep some of what you earn. You've built it, now keep it. You can look up a Debtors Anonymous meeting in your area. You'll see there's tons of people in a worse situation than yours. Don't be stressed about it. Just pay it off. You'll feel great! Good luck!

You can only take out of your ROTH what you put in and not any of the gains. There is also a time limit that it needs to stay in but I can't remember what it is. Besides, that ROTH money is growing tax free so you'll be shooting yourself in the foot in the long-term (IMO) to take it to pay your credit card debt off.

Another alternative is to reduce, or stop - depending on company match - putting into your 401 at work and designate that money towards your credit card debt. Be faithful about using that money only for the debt and nothing else.

Have you looked into transferring the balance to another card altogether? You might be able to get a better interest rate if you combine the 2 into 1.

Do not use the IRA to cover your debt. The penalties are way too steep. I crashed a business and used my IRA money to cover some of my debt. It was a huge mistake. Big time, do not do it.

You're better off selling what ever you can to get the credit cards paid down. Take a second job if you need too, and get on a completely penny pinching budget...no dining out, no cable, no cell phones, etc.

If you can only afford the minimun payments each month, then I would beg to differ with your assessment of the situation; you ARE in dire straits! It probably doesn't look that way to you because most people live their lives that way! That doesn't make it right...

It's your decision, but I can promise you will live to seriously regret it if you cash out of the Roth or any retirement account. Especially since you are only 34.

If you don't want to give up the cable (LOL), then get a second job and dedicate ALL of those earning to paying off the debt.

Cut all the cards up.

Pay off the smallest balance first (mathematically this may not make sense, but it will make you feel as though it's not an impossible task), then the next, and so on.

Don't use the IRA money. What you do is pay more to the card with the higher interest rate until it's paid off, then work on the second one. Will you be getting a refund from the IRS in April? If so, use all of it to pay down the debt.