1) 350 word minimum for discussion posts.

What is your advice to someone on paying off credit card debt and investing for their retirement?  Do you feel as though they should pay off all credit card debt before investing for their retirement or is it best to start investing for retirement as soon as possible?

2) 50 word minimum for replaying to the following discussion.

It can be a trickhy situation for most people. Do you build a retirement fund or do you use those funds to get yourself out of debt first? 

My initial thought on this is a person needs to find the balance to do both. There are many factors that come into play with this. First is where are you doing the retirement savings? Hopefully it is ina 401k or similar, where you have a matching contribution from your employer. Not participating in a matching program is like throwing away free money. They are giving you usually up to 4% in matching funds, so yes, you absolutely should be participating.

The other part is how much interest are you paying on your credit card debt? It is a low interest? If you are paying 20% or higher interest, then saving at say 5% interest in a regualr savings or unmatched account, is something a person has to conside if it makes sense. One big problem is it being credit card debt. Meaning yes, you can pay it down, but you can also charge it right back up, ending up ina perpetual cycle on debt and never building that retirement fund. THIS is where I feel a lot of Americans are at. They say they can’t afford to save due to debt, but when will the debt end? This is why I feel participating in doing both is important. 

I think if someone has a lot of debt, they should put a small amount into retirement savings and large portions to their debt. They should try to consolidate their debt or get a lower interest rate, to help them pay it down faster. A good way to build the retirement savings, outside of a 401k program, is to have a portion of your paycheck be pulled directly into a savings accont. It is out of sight, somewhat forgotten about, and you get used to working with the funds made available to you in your checking only. It can be easy for people to put off transferring money or moving funds, so if it happens automatically, it makes it easier to save. Same with automatic payments to your debt. Set them up for the most your can afford, never just minimum payments and the auto pay helps keep a person on track.