Stocks vs Debt Collectors

I'd hold on to my stock and think of another way to pay them off. Depends on the nature of your business. One thing for the future is to incorporate if you have not already done so.

Make a payment arrangement with the debt collectors and set mini-goals. make an extra $2000 per month to pay them off. then get creative. do a fundraiser to earn the money.

I would sell the stocks because the debt accrues interest and fees at a much greater rate than stocks are growing. DO NOT pay through the debt collectors though, go directly to whomever held the original debt. By paying the collectors you often unwittingly pay more for the debt collection service while the most the original debt holder can charge is a little interest.

The stock market maybe has one good recovery in it then when large scale inflation sets in its going to pop. This economy is simply unsustainable. I advise you to read Peter Schiff's Crash Proof. The bottom line is get out of the debt at the best possible time. Then cut back on everything you can and convert the savings to hard assets like gold and silver. Silver I prefer for fear of another gold recall. That's right at one point they actually came and took back all the gold people owned and sold it to america's creditors for 35 dollars an ounce,Thank you Richard Nixon. The patient has been given morphine for a fatal gunshot and everyone is calling it a success because there is less screaming from the patient. Be vigilant. Get debt free. Get real assets.

getting out of debt is a brilliant idea. do that and then save!

Sell the stocks while they are worth something. In fact, if you have more than enough to cover the debt, sell all you have and invest in silver.

If your debts went into collectins, try using a debt consolidation service which can negotiate to lower your debt for you. If it's credit card debt, I definitely suggest using a debt consolidation service, they can lower it by half or even more. If you want to keep your good credit, get rid of th debt, fast.

Opinions are going to vary on this one (and I am not a financial advisor), but I think it comes down to doing the math and figuring out which is going to benefit you the most in the long run.

If your debts are growing with interest, then you're going to want to take care of them quickly. The interest on debts could quickly surpass any gains you're getting in the stock market, putting your further in the red.

On the other hand, if you're holding stocks that will probably gain significant value when the recession comes to a close, you might want to hold them and find another way to pay down the debts. It's a judgment call. I don't know what your portfolio looks like.

If your debts are old and have been written off as noncollectable by your creditors and are not gaining any type of interest, you may want to simply let them sit untouched. They probably can't do any more damage to your credit score and most states have statutes of limitations of around 6 years for debts (see your state's laws on time-barred debts). They'll eventually drop off your credit report in 7 years.

If the debts are newer, you're going to want to take care of them so you don't have to have them tarnishing your credit for the next several years. Just remember that you decide what you can and cannot pay. Don't allow creditors to pressure you into repayment plans you're not comfortable with. Use the state of the economy as leverage to get your payments reduced or to settle older debts once and for all. There are options and some Google searching should help you find some good tips.

Best of luck!

Almost every financial adviser I have ever met says that you should pay down debt as soon as possible, if you are paying a higher interest rate than what you are getting from your investments.

The answer completely depends on the interest rates.

For example, if your school loans are at 4% and your credit card debt is charging 18%, pay off the higher rate first.

Regarding selling stocks, I would take a look at how much you are up or down.

You can always buy stocks back later. You are still young with a ton of time left to invest. However, carrying significant debt will kill your credit score and your ability to get a loan with a decent interest rate.

I would sell stocks to pay off debt.

-Brian