Debts push you to the wall as retirement nears. On Oct. 9, 2014, Fox Business noted that boomers, especially, need priorities for paying them down. That article discussed some fundamentals about debt reduction. The most important of these is to refinance all debts into a lower cost, delayed structure.
In my opinion, debts are like being overweight. Start with the easy part: less eating. Over the years, I have advised many clients on how to manage debts, and have explained that there are three rules:
1. Make all minimum payments as required. Don’t go into default.
2. Pay as much as you can on those debts with the highest interest costs.
3. Do not increase debt unless it is essential for survival, not for luxury.
Typically credit card debt has the highest interest. Pay it down and keep it down. Ideally, pay it off each month so that you do not get into periodic payments. Look to other debts with the shorter maturity dates so they do not fall behind.
But there is another aspect to paying off debts: having the money to do it! Look to cash savings, as well as material things that can be sold such as a time share investment or a second house.
Then look at your life insurance, which you could sell to a life insurance policy to a provider like GWG Life for more than the cash surrender value. Use the cash payment, plus what you would have spent on the premiums, to pay down debts.
To learn how you could sell your life insurance policy, call GWG Life at 877-494-2388, or visit www.GWGLife.com.