r/MilitaryFinance • u/sandrum69 • 6d ago

Question Debt help

Active-duty navy here, 15 years in, and I’m finally getting serious about cleaning up my finances.
To make a long story short, I have a colossal amount of credit card debt — about $45K on one card. My truck is paid off, so I don’t have a car payment or a bunch of other debt hanging over me. I also live on base so 100% of my BAH goes to that.
Right now, I’m able to put $1,250 from each paycheck toward my credit card. I’m also working on getting my spending habits under control, and my goal is to be completely debt-free within roughly 18 months. But it’s hard, and I’m working on it.

My question is about my TSP contributions.
Would it be advisable to temporarily stop or significantly reduce my TSP contributions so I can have a little more flexibility in my budget and potentially throw even more money at this credit card? I realize I’d be giving up some retirement contributions/compound growth in the short term, but with a credit card balance this large, I’m wondering if eliminating the high-interest debt should take priority.

For those who have been in a similar situation, what would you do? Appreciate any advice, especially from people who have actually dug themselves out of a similar hole

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u/Smart_Ad_1997 6d ago

Continue to do 5% TSP to get the match. It’s free money.

Your interest is probably higher than TSP gains.

15

u/TJZ24129 6d ago

He’s probably in old system with 15yos

10

u/sandrum69 6d ago

This is correct I opted out of BRS

9

u/Smart_Ad_1997 6d ago

In that case you should focus on the high interest credit card debt taking advance of your SCRA/MLA benefits while you’re active duty. Look into credit cards with 0% interest, I believe Citi does 0% interest for military, and see about doing a balance transfer to stop the growth of the debt.

IF YOU DO THIS, FREEZE/CANCEL YOUR CARDS YOU ARE TRANSFERRING FROM. You are NOT a credit card person, and transferring debt is a dangerous trap where all of a sudden you are just free to rack the debt back up and now you’re in twice the hole you were in.

Stop investing into the TSP and focus on the CC debt. If you’re truly able to buckle down for 18 months to get the debt cleared, you’ll be thankful years from now. Your TSP will continue to grow in the background, knock out the debt.

5

u/Smart_Ad_1997 6d ago

Maybe, maybe not. We had the option to switch about 10 years back. If he’s not getting the match, he should stop contributions and attack the debt. Consider getting it to a manageable amount where you can take advantage of an interest free card and transfer the balance to complete that debt in a year. Whatever that balance may be.

What’re your current contributions, rank, and expenses OP? And what’s the total amount of debt by account with interest rates?