@blade10327 The taxes incurred with early withdrawal from retirement accounts is sort of a 1-2 punch. Not only are you having to pay the taxes on the withdrawal, you’re also missing out on the DECADES of growth those dollars have until you hit conventional retirement age.
The good news: this debt is conquerable and you caught it before spiraling out of control.
Quick napkin math shows that you’re losing about $110 to interest alone each month. You need to triage this debt and start tackling it. Because you’re not getting a match in your TSP, I’d suggest not putting anything into the account until you’ve got the high interest debts paid off. Pay down your highest interest debts first, working your way down to the 0% debt.
Forced austerity is going to have to be a necessity for a little while. Things like canceling subscription services and putting the choke on your household discretionary spending will expedite the process.
Is there any way you and your wife can generate more income? Could she work part time or on weekends while you’re with the newborn? Perhaps you could try gig economy jobs like food delivery or rideshare services?
Finally, go through your tax return with a fine-tooth comb. Check out free preparation and filing services offered at your installation or through major e-filers. As a service member filing jointly, with one child, you should be getting a fairly significant refund (granted your W4 withholding is a complete unknown to me). This refund needs to go to these debts if it hasn’t been allocated to them already.
