CALL FOR A FREE
INITIAL CONSULTATION
813.254.5696

Don’t jump to a credit card debt relief decision in Florida, II

A warning about credit card debt relief options was the focus of our prior post. It wasn’t a warning against finding a solution, but instead it warned about jumping into a decision before truly understand the benefits and consequences associated with that decision and other options. We used withdrawing from 401(k) as an example, the first post focusing on the current costs associated with this option.

In our prior post, we determined that an individual in the 25 percent tax bracket could have to withdraw approximately $15,000 from a 401(k) to pay off a $10,000 credit card debt. However, this is only a present-day snapshot. Looking down the road, that money may actually cost $60,000. How?

The money in a 401(k) continues to earn interest. For a person who would have left it there for another 14 years, the average 5 percent interest rate would have increased the future value to that $60,000 mentioned above. Again, for some there may be sufficient funds there to make this a viable option.

Borrowing from a 401(k) is another option that helps avoid the tax issue, but there are often serious restrictions. For example, the loan may become due should an employee choose to leave their job. Getting laid off could also cause the same result.

This is only one example, but it illustrates the need to research options first. What is right for one situation is not always the best choice under other circumstances. This is where a bankruptcy attorney can provide advice based on research and experience on the widest variety of possible solutions tailored to a case-by-case basis.

Source: Fox Business, “Withdrawing vs. Borrowing From 401(k) to Pay Credit Card Debt,” Gary Foreman, April 29, 2013

Tampa Bankruptcy Law Blog

3 Reasons Why Bankruptcy Cases Get Dismissed and What This Means for You

Bankruptcy Case Dismissed There are two possible outcomes for those filing for bankruptcy. It doesn’t matter if you qualify for...
Read More

Who Files for Bankruptcy?

Should I File for Bankruptcy? If you’re considering bankruptcy and you feel as if you’re the only person in the...
Read More

3 Reasons Your Student Loan Debt is Ruining Your Financial Future and How Bankruptcy Might Help

Student Loan Debt Taking out a loan or multiple loans to attend college is nothing new. Students have been using...
Read More

What Happens If You Miss Your 341 Meeting?

341 Meetings are One of the Most Important Obligations in Bankruptcy There are several requirements you must meet when you...
Read More

3 Things to Help You with Post Bankruptcy Credit Repair

Bankruptcy Credit Repair One of the biggest challenges you’ll have post-bankruptcy is getting credit extended to you. But for most...
Read More

What is the Real Reason People are Filing for Bankruptcy?

Can filing for bankruptcy help you with unpaid medical bills? One of the most common misconceptions about bankruptcy is that...
Read More

What You Need to Know about Bankruptcy Court

Bankruptcy Court Bankruptcy is a process that many people find intimidating. In part, this is because they must turn their...
Read More

What to Expect from Bankruptcy Counseling

Bankruptcy Counseling Filing for bankruptcy is not an easy decision. For many, it’s their only option for getting the debt...
Read More

Why Hiring a Bankruptcy Attorney is Worth the $ [Infographic]

Everyone who files for bankruptcy must complete a bankruptcy petition. It can be up to 40 pages and filled with...
Read More

What Really Happens When You Declare Bankruptcy?

How to Declare Bankruptcy Bankruptcy is a last resort for many who file. After attempting to clean up a messy...
Read More

Contact Us

Search Website

Archive

Request a FREE Consultation

For The Next 5 Days Get A Free Book About Bankruptcy

Bankruptcy Book

We are A Debt Relief Agency.
We help people file for
bankruptcy under the Bankruptcy Code

Pay OnlineBankruptcy Courses

National Association Of Consumer Advocates Logocomodoavvo1avvo2avvo3LEA
BBB LogoRG Seal

Tampa Office

$Law Offices of Robert M. Geller, P.A.
807 West Azeele Street
Tampa, FL 33606
T: (813) 254-5696
T: (800) 853-7549
F: (813) 253-3405


Tampa Bankruptcy Lawyers Map

St. Petersburg Office

$Law Offices of Robert M. Geller, P.A.
125 5th Street South
(Wells Fargo Financial Center)
2nd Floor, Suite G

St. Petersburg, FL 33701
T: (727) 532-3939


Map and Directions

Pasco Office

23526 State Road 54
Lutz, FL 33559
T: (813) 336-2320





Maps & Directions

At the Tampa Bay law firm, the Law Offices of Robert M. Geller, P.A., we help people with consumer bankruptcy matters in the Tampa Bay-St. Petersburg,  Florida communities such as Clearwater,     St. Petersburg, Tampa, Thonotosassa, Riverview, Lutz, Plant City, Brandon, Carrollwood, Wesley Chapel, St. Petersburg Beach, Lakeland, Mulberry, Dade City, Pinellas Park, Largo, Seminole, Odessa, Oldsmar and Lithia, and counties such as Hillsborough County, Pinellas County, Pasco County, Polk County and Manatee County.