OK, I’ve paid the debt down to about $15,000. Interest on it is 9.9 percent. I still have a mortgage of around $100,000 at 5.5 percent. Social Security income plus interest income plus stock dividends amount to about $30,000 per year.
Question is: Should I take my required minimum distribution from my IRA early in 2008 to pay off a chunk of the credit card debt? I would not want to take a distribution of, say, more than $7,000 to put toward this credit card. The IRA is in a “super money market fund” that earns about 5 percent.
We all love our kids and want to help them any way we can. I have three kids of my own — I know how you’re feeling. But, you are a retired senior. You have to live off this money. You are not in a financial position to help your son with this kind of debt. You can help him month to month, but don’t take out a large chunk of your money to throw at this. I’m not saying your son has to file bankruptcy. He needs to find additional forms of income — sell stuff or get a second job — and start paying down this debt. He can do it — he’s obviously a hard worker.