Dave Says: Sell stock to get out of debt?

Dear Dave,

I have about $5,000 in an individual stock and $6,000 in debt. Should I sell the stock and pay off the debt?

Leann

Dear Leann,

Let’s look at it this way. Pretend you only had $1,000 in debt, and you had a credit card with a $5,000 open line of credit. Would you go borrow $5,000 on it to buy that stock? Of course not. It’s the same kind of thing in reverse.

If I woke up in your shoes tomorrow morning, I’d have only $1,000 in debt before the coffee started brewing. Sell the stock, and pay off the $5,000. Then, I’d formulate a plan, get on a budget and fix that thing in my life called overspending so that I could knock out the remaining debt in no time and start building wealth!

Dave