Help with a personal finance discussion between myself and gf.

[Brian H.]

Hey folks!

Ok, so my girlfriend has, at this point, about $45k in her retirement from her job.  It is a 403(b) plan from a hospital.  She has multiple varieties of debt she wants to pay off to get out from under all that financial stress.  She asked me today if it made sense to cash in almost $30k of that retirement and eat the penalty to pay off the debt. It is a combo of student loan debt and a vehicle loan.  

My response was "Absolutely not! Do not touch the retirement account for that! We will figure it out some other ways." Is this the right direction? It would be really financially unwise to touch that retirement for something such as paying off debt... right? Or no?  Looking for some direction.

Thank you!!

[Thomas S.]

You are right in my opinion. All she has to do is adapt her life style to something more frugal, less expensive housing, reduce entertainment expenses, cell phone, cable etc. Get rid of the car and buy one she can afford. Debt normally is about a wasteful pay check to pay check life style. If she is not prepared to adopt a frugal lifestyle then she is hopeless and you may want to be on guard with your relationship.

If she chooses to use her 403b her debt will only return in short order.

Paying off student debt is about changing your life style to accelerate payments.