3. Can you reduce your credit card rate? Call the 800 number on the back of your credit card and ask a service rep. That works about 50% of the time. Explain you have offers from various other credit card companies. Can you at least get 6 months of no APR and then return to your old rate to help you pay down your debt? Be firm. If the first rep can’t help, ask for a higher-up. If the card company thinks you’re ready to jump ship to another credit card company, they’re more likely to accommodate you. Just a little FYI: Assuming the average interest rate on your cards is around 12% (which I think is pretty conservative) paying off your debt is like paying yourself that 12% interest. How about them savings!
4. What can you get rid of that won't cramp your lifestyle? $400 for a new car…Can you trade it in for a car with a smaller payment? Also, call up your insurance company and ask for a lower rate. Use that same haggling method when asking for a lower credit card rate. What about your cable bill? And you cell phone bill? Can you reduce your plans on both? Any excesses that you can temporarily shut down? You have more important goals – to erase nasty credit card debt and save for your family’s future.
5. Okay, you’ve rolled your eyes through tips 1-4. You’re still desperate to withdraw your wife’s lingering 401(k). Call up the 401(k)’s planner, be it Prudential, Fidelity or the like, and ask about the associated fees. You may find that after it’s withdrawn, you pocket only $20,000 at best. OK, absolutely use that to pay down your credit card debt. But don’t neglect all that I’ve suggested above. You may find yourself in the same predicament in the next year if you don’t watch your spending.
Finally, some parting advice for you, CrankyBear, since I want to help you and see you and your family get back on track bigger and stronger:
