I am able to retire soon and collect my union pension.
I am also in debt, because we purchased a new home last year for our retirement and got carried away with all the expenses that comes with that, i.e. new furniture, moving expenses, household goods,window coverings and etc.
Also my job is seasonal, so while income is good 7-8 months out of the year, the other 4-5 are a struggle big time.
The home itself is affordable, no issues with that, however since I want to retire (take my pension but keep working at a lower paying job in my new home state FL) the income should be roughly the same, maybe a tad higher. However, at that rate it would take me years and years to pay off the credit cards we've amassed in the last 7-8 months.And we're not the frugal kind so I know there would be other expenses that would probably derail that plan as we go.
Now I can take a lump sum out of my union pension that could wipe out all that debt and then some, however permanently reducing my monthly pension by about 500 per month or so. Now I'm still young (60) so that 500 I'm sure will be needed in my 70s and 80s etc. (not counting ss of course).
That reduction of $500 of pension, would be wiping out about $1500 or more of high interest debt per month. Seems like a no brainer, but I'll never be able to get that retirement money back, whereas a bankruptcy lets me keep it, but eliminate debt.
I believe the courts cannot touch retirement accounts/pensions/IRA's etc. or Social Security, correct?
So my question is it is wise to permanently reduce my pension to pay off debt, or leave as is and try to pay off debt however long it takes, and if it's not possible, consider bankruptcy to wipe (most) everything away,start fresh and keep my retirement. I know it would probably be frowned upon, but am also trying to protect whatever I can and keep the retirement monies.
I'm ok with having a bk7 on my credit report, if overall I'm in way better financial shape, despite the negativity of a bk in my file.
I'd be better off paying cash for everything, these damn credit cards are so addicting and easy to get in trouble with.
Submitted May 19, 2019 at 11:03AM by ss1959ml http://bit.ly/2w3Jju7
