Should I withdraw $45,000 from my IRA to pay off credit card debt?
I am 63 years old. Because of a change in employment status for the last 4 years I went from full time to part time. In order to survive I had no choice but to use my credit cards. While I did look for full time work, I was unsuccessful in finding full time employment. Since then I am now back to full time status. While my current salary is $100k, my credit card debt is approximately $45,000. The average interest rate is approximately 13%. I have been able to do some balance transfers but for only about $5,000 of the debt. I have an IRA with approximately $230,000.
I don't know if I would be paying more in interest to the credit card companies paying every month for the duration, which is years paying the minimum, or would I pay more taxes if I withdrew $45,000 to pay off the credit card debt.
While I do try to pay either double what the monthly bill is, or at least $25 extra, the interest I pay every month is still high. I have one mortgage and one open line of equity on my house and my monthly expenses are approximately $4,500 (not including the credit card debt).
On top of everything else, because I was not able to keep up with the upkeep of the house, it has fallen in disrepair and I need approximately $15,000 worth of work in order to make is sellable. I am hoping to sell the house to pay off the mortgages.
Thanks to everyone for your kind answers and advice. I actually do not have a spending problem. I didn't get into great detail on my credit card use because I was just seeking an answer on IRA withdrawal vs. credit card interest. I can honestly say I did not use the cards for anything but necessity. During the time of my unemployment I had a accident and broke my foot. No insurance. My hot water tank had to be replaced as did my washing machine along with 2 small roofs on my house that had to be replaced as roof leaks caused internal water damage, as well as the railing on my porch needed to be replaced due to termite damage. My insurance company would not re-insure my house unless those repairs were made. These were all very big ticket items, especially the medical bills. When I went through my savings I had no choice but to use credit cards. So yes, I needed them to survive. While I was able to work on a part time basis it was hardly enough to cover expenses. Monthly expenses are now approximately $6,000 with mortgage, equity line, heat, electricity, food, gas for car, cable, cell phone, general upkeep, and of course credit card bills. I am lucky enough to get my job back to almost full time so while I have a good salary, it's still not what it was. I live in a major metro area. In all of you answers I will continue to pay on the credit card debt and double up whenever possible on payments and not withdraw from my IRA. I do not use my credit cards at this point because I can now use my salary to keep current. It's very hard to get the credit card debt down when you pay so much in interest, even with the extra payments. That is why I asked the question.