I have some debt and I also have money in investments. I was thinking of selling the investments and paying down all debt to be debt free with the exception of house and small second mortgage. I want to get some opinions on this.

Here is what i have

Stock Account $20,613.65
investment acct $162,866.32
Savings $7,315.44
Savings $13,860.80
Savings $3,610.51
Savings $1,862.82

Sub Total $210,129.54


401K $258,149.72


TOTAL I $468,279.26

DEBT TO PAY OF
Credit Card 1 $9,315
Credit Card 2 $8,901
Credit Card 3 $5,138
Car Loan $5,630

TOTAL DEBT $28,985

I would liquidate my stock account of $20,613 I have apple stock in there so would need to pay capital gains etc. I would also liquidate my $7,300 savings account. All else would stay the same. I would pay off all outstanding debt. My interest payments on the debt totals abut $200 a month so that would all be gone.

I don't really want to get rid of my stock account because I have done so well with it and also will have to pay cap gains. but the thought of debt free is great.

Any advice? Thoughts?

Are any of the investments funds tax-sheltered, besides the 401(k) you mentioned? Or can we assume you'll pay capital gains on all of it? And what are the interest rates on the debts? Is any of the credit card debt in a 0% interest promotional period?

With those considerations, I would definitely do what you are considering and liquidate some investments to pay off all that debt. I would also consolidate the savings. It will increase your monthly cashflow and simplify the number of accounts you're tracking.

Whatever you do, don't listen to kombat. he does not understand money.

what is the interest rate on your debt?

Have you held the stocks for over a year? If you have I would not let fear of paying the tax man keep you from paying off your credit cards at a minimum. The top tax rate on long-term capital gains is currently 15% and I believe they are still scheduled to go up come January 1st 2013 (unless the politicians have changed this recently).

Are you done adding to your credit card debt? If so then it's certainly worth considering, but if you're going to wipe it out only to build that debt up again then I'd say there's other things to focus on first. I'll leave it to the experts on the forum to say whether it's a good idea in principal or not.

Is there any reason why you can't take the 4 savings accounts which add up to approx. $26,650 & pay it towards the debt of $28,985? Pay off all the cards & stop accumulating credit card debt. Then pay the remainder toward the car loan. Those savings accts are almost enough to wipe out all of your debt without cashing in any investments or taking a loan from any retirement accounts. All you'd have left is a $2,330 car loan.

Yes, listen to Kombat and Tightwad. They know what they are talking about.