No. of Recommendations: 0
Being desperate to start building my savings, I had the idea of pulling out of the stock purchase plan for now and dump this money to pay off my credit card (this would put me out of debt 3 months earlier).

-Stock: HWP
-Quarterly Contributions to Stock Purchase Plan: $870
-Quarterly Matching by my employer if I participate and hold stocks for 2 years: $435
-Credit Card Debt: $4,700
-APR on Credit Card: 14%
-Planned Monthly Payments to Credit Card: $750
-C.C. Payments if Pull Out of Plan: $1,040 (and save approx. $110 in interest paymts).

You've already done most of the math on this one. Here's my take on the two options.

If you stay in the plan you make $325. This is the employer match ($435) less the additional interest ($110) you'll have to pay by not paying earlier.

If you pull out of the plan you "make" ($110) from the interest payments you don't have to pay.

This does not take into consideration what the stock price does, or how bad you want out of debt. Based strictly on what you make it looks like staying in the stock plan is the best choice.

Print the post  


UGC Disclosure Notice Regarding Credit Card Posts
Community board discussions about credit cards are not provided or commissioned by banks who may have advertising relationships with The Motley Fool. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.
TMF Credit Center
The Motley Fool Credit Center arms you with real tools and simple messages, that will help you in every credit situation.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.