I am a 50 year old public employee who is retiring within the next year. I will soon begin paying off the parent plus loans that I took out for my three children's college education. I owe approximately $200,000 at an average 7% interest rate with a repayment plan of 30 years. As I will be retiring, I will have access to my 457b funds once I separate from service. I have $200,000 in a stable value fund earning a guaranteed 4%.
Ideally, I would like to withdraw $200,000 from my 457b plan and pay off the $200,000 in parent plus loans. Obviously, the tax burden withdrawing and paying taxes on $200 grand is of great concern to me and may be financially unwise and unrealistic.
The $200,000 in my 457b plan represents a little more than 20% of my retirement portfolio. My wife will continue to work for a few more years before retiring with a pension as will I.
I would appreciate any advice and ideas on how best to address my situation. Thank you.
Ideally, I would like to withdraw $200,000 from my 457b plan and pay off the $200,000 in parent plus loans. Obviously, the tax burden withdrawing and paying taxes on $200 grand is of great concern to me and may be financially unwise and unrealistic.
The $200,000 in my 457b plan represents a little more than 20% of my retirement portfolio. My wife will continue to work for a few more years before retiring with a pension as will I.
I would appreciate any advice and ideas on how best to address my situation. Thank you.