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I rolled my401k into a self-directed Ira in 1996 and have made excellent returns on it. However, my husband and I have about $18,000 in debt from credit cards and loans. Question: is there a way to use my ira to pay these off without a penalty or at least a small penalty. p.s. i'm nowhere near 591/2.

heddilamar2@aol.com
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Don't do it. You can not borrow against an IRA. If you take money out you will pay federal tax, perhaps state tax, and a 10% penalty for early withdrawal. Not worth it. Especially since you are making excellent returns on it, you need to let it compound tax free until your retirement.
You need to develop a budget and figure how you are going to pay off those debts. Read around here, lots of people have the same problem and we are debt-elimination specialists. Make a list of all the debts and the interest rates. Pay the minimum on all except the highest interest rate (or the smallest debt if that is really what you'd rather do--highest interest rate gets rid of more interest). When one is paid off, apply that amount to the next debt. When a minimum decreases, don't decrease your payment, continue that amount. In this manner you can take charge of the debt monster and slay it!
And don't even think about stealing from your retirement. Hands off!!!
Best wishes, Chris
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Crosenfeld writes (in part):

You need to develop a budget and figure how you are going to pay off those debts. Read around here, lots of people have the same problem and we are debt-elimination specialists.

I reply:

Here's where you can find many fellow travelers working on these issues: http://boards.fool.com/Messages.asp?id=1040018005926010&sort=postdate --Bob
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