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Another Ramsey question

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Those who listen to Dave often, maybe you know how he might answer this question.


He mentions in his book to take every bit of your savings, except $1000, and put it toward debt.


Does he include retirement savings? The book only talks about whether to continue current 401k contributions. I want to know what to do with the two saving accounts from DH's previous jobs. We are not contributing to those anymore.


Do we cash those out and pay the penalty to use the money for debt reduction?


I'm hyperventilating thinking about it.

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I have heard Dave say that you never early withdraw from retirement unless it is to avoid going bankrupt. With the early withdrawl peniltys and taxes it's just not worth it. If you have some extra money that you have not yet put into a retirement account but is just sitting there, then it should go on the debt, but other than that I'm pretty confident his answer would be, "No!"


Good luck! We are on baby step 2 as well and can't wait to be moving on to 3!:tongue_smilie:

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Dh has some ideas of what Dave may say, but the best thing you could probably do is to ask over on the Ramsey Forums. Dh thinks he'd say no to taking it out, unless there were things such as forclosure, evictions, etc. in the future. Also, your specific situation/debt would have to be assessed for him to make the call. You should call him!


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