I want to retire next year, but I have $25,000 in credit card debt and a major monthly mortgage payment — I also live with my three kids and ex

I will retire next year with $25,000 credit card debt and 15 years to pay off my mortgage. The interest rate on credit cards is 0%. My retirement benefits include a great medical benefit that will protect my two sons, who are less than 26 years old. My monthly expenses include life insurance, utilities and a car payment.  

My monthly mortgage payment is $4,000 The interest rate was 2% up to January 2022, then 3% through January 2023. The remainder of the loan is 4.5%. Is it worth refinancing to a lower interest rate? I plan to pay the principal in December and April and not pay interest. Two credit cards are available to me: One with $20,000 and one with $4,500. The 0% promo ends April 2021. 

I work for state. My pension, 401k and 457 investments amount to $110,000. I also have one month’s worth of expenses in an emergency fund. While I am employed, I cannot apply for a loan to my retirement accounts. 

I’d like to know if retirement is a good idea. If yes, would it be appropriate to take out a loan to pay off my credit card debt before I retire? Based on our benefit, I don’t have to repay the debt (to the 401(k)) after my retirement unless I win the lottery or something. There won’t be a penalty. My annual gross earnings are $96,000

I’m a cohabitant with my ex on the house but get no contribution from him at all. I am currently working with my lawyer in order to determine if I can kick him out of his house.

Please help.

We are grateful.

CDT

See: I’m a 57-year-old nurse with no retirement savings and I want to retire within seven years. What should I do?

Dear CDT 

You have a lot to juggle, so the fact that you’re reaching out to someone for some financial guidance should be deemed an accomplishment all its own!

You may be able to delay retiring if it is possible. Having $110,000 in retirement accounts is great, and you don’t want to have to start dwindling that down while also trying to manage a way to effectively pay down credit card debt and a mortgage. In the event of an emergency, you could lose a lot of your nest egg. 

“I think she needs to take a hard look at her income and expenses,” said Tammy Wener, a financial adviser and co-founder of RW Financial Planning. “When it comes to retirement, so many things are out of your control, like inflation and investment return. The one thing you do have control over is expenses.” Furthermore, your pension may be enough to maintain your lifestyle — though advisers wondered what exactly you would be getting from that pension every month — but you would still be better off with a larger nest egg to fall back on. 

Let’s say you are going to retire next year, but still have huge credit card debt and bills to pay. Any retirement income you have with and outside of your current funds may not be sufficient for your current living expenses, and if in a few years you realize this, you could end up back in the workforce — though it This may prove to be difficultYou can get the same or similar job that you had before. 

Let’s look at your 401(k) and 457 plans for a moment. You said you could take a loan and based on your benefit you don’t need to pay it back, but you should be extremely cautious about this. With 401(k) loans, employees may be required to repay that loan if they’re separated from their employers, so this is a stipulation you should absolutely verify. Wener stated that if there were any misinterpretations about how a loan was treated, the remaining loan would be considered taxable income if you quit your job. 

Investment advisers often advise investors to avoid taking out loans and withdrawing from retirement accounts. In your case, this could be especially true if you are planning to retire in the next 12 months. While you might be paying yourself and your account back when you take out a loan you can also lose investment returns as your balance will be reduced by the amount. Many Americans who borrowed money or took out loans now regret their decision. Recent survey. “I would not recommend ‘swapping debt’ by taking a loan from her investments,” said Hank Fox, a financial planner. “Instead, she should pay whatever amount is due each month to avoid the finance charges and continue to pay-down the balances.” 

Don’t miss: Five ways to get free financial advice

Also, consider what would happen if you continued to work: you’d still be able to contribute to a retirement account, boost your savings and, if applicable, reap the rewards with an employer match. You’d also narrow the amount of time you have between retirement and When you can claimFox stated that Social Security benefits are available. 

Outside of the retirement accounts, you should try to build a “sizable” emergency fund, Wener said. Financial advisers typically suggest three to six months’ worth of living expenses, though you might want to strive for closer to six to offset any undesirable scenarios. 

I’m not sure what the motivation was to retire next year, but if you can delay it, this may be the best solution. “The first thing I would recommend is that she reconsider retiring next year,” Fox said. “Since she will be 57 in November and assuming she is in good health, she should expect to be in retirement for 30 years or more.” 

If postponing retirement is not an option, and it isn’t always, he suggests reducing or eliminating your mortgage, since it’s your largest expense by far. You could RefinanceWener stated. Interest rates are very low these days, and while you may end up paying a little more every month for the next two years compared with that 2% rate you currently have, you’d end up paying the same and then less from February 2022 and on. 

Credit cards with 0% interest rates are a great way to pay off your debts quicker. You should call your current credit card company and ask about the options. 

A Financial advisor — specifically, a Certified Financial Planner — could really help you crunch the numbers and find meaningful ways to make the most of the money you have now and will be getting in retirement, said Vince Clanton, principal and investment adviser representative at Chancellor Wealth Management. 

An advisor will gather information about your income, expenses, retirement savings, Social Security benefits, and pension to create a financial plan that will help you navigate retirement. “Voluntary retirement, and particularly early retirement, are very big decisions,” Clanton said. “It’s extremely important to know and understand all of the variables.” 

For clarity, letters are edited.

Have questions about your retirement savings plans? Send us an email at HelpMeRetire@marketwatch.com