Today, I would like to do some napkin math in order to plan a way out of this debt pile I find myself in.

To start, we’ll use the rule of 72 alongside the inflation-adjust return of 7%. That means every 10 years and 3 months, we can expect the money to double. Since I am now 39, it’s the perfect time to run this projection against age 59 (technically 59½), when IRAs can be withdrawn without penalty. That timeline fits 10 years and 3 months nicely, as it is exactly 20 years and 6 months away—giving us two full doubling periods. Capping an IRA this year at $7,500 means that single contributions would become $30,000 by standard “retirement” age.

In my “More CoastFIRE math” article, I talked a little about how to judge what taking the pedal off the gas is worth in order to increase cashflow now. If I took my planned 2027 401(k) contributions and redirected them toward the 401(k) loan (while still maintaining my employer match), I’d end put around $7,200 into the 401(k) and be able to put $17,800 directly at the 401(k) loan balance. That would still end up inside the 401(k), but it would mean roughly a $4,000 tax hit and an opportunity cost of $71,200 by age 59.

Doing both things — redirecting 401(k) funds to the loan and shifting IRA contributions toward other debts — would clear out the SOFI loan, Car loan, and 401(k) loan by end of December 2027. That opens up $2,800 in potential monthly cashflow by January 2028. These are the trade-off numbers that need to be weighed when slowing down or stopping retirement contributions.

Destroying those debt piles lowers our annual budget expenses by $34,400. That means if we temporarily sacrifice retirement contributions to clear these balances, we give up around $101,000 in future retirement growth to unlock a significant increase in cashflow that can re-enter brokerage accounts and other investments.

I haven’t made a final decision on moving forward with all of this yet, but I’m thinking this might be a solid path forward. FIRE calculators show that we meet our baseline expenses by end of year. While that isn’t a comfortable age 40 retirement, it means the math behind the 4% rule puts it as an option on the table. So, if I redirect part of our 2026 IRA funding, I can free up significant money for debt repayment, at a cost of very little in taxes.

Debt Plan October 2026 Onward.

• Pause Wife’s IRA contributions on Thursday Oct 1st should be at $4,000/$7,500 for 2026.
• Fund 2026 HSA. $8750, Using back pay money will likely split into 2 contributions. Oct 1st and 2nd.
• Perfect World this allows the remaining $3,500 of the Wife’s IRA to go take Oct 5th – Nov 20th.
• September Vanguard dividends ~$200 will flow to SoFi debt.
• Vanguard dividends will continue this way until debts are cleared.
• After November 20th, the next $7,500 that was planned for my IRA will flow into the SoFI loan, followed by the car loan.

Actually, the car loan has a higher interest rate, so maybe that would be better to aim for first. I’ll re-tackle that later.

~~Miniwing~~
Tired of Bills