Pay off IRS or Keep Saving Money?

Pay off IRS or Keep Saving Money?
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#1

I’m paying IRS on installment agreement for 2014 back taxes. Been paying on it since 2016 and am down to owing $8500.

I am 51 years old and only have $15,000 saved and No assets. Yep, I’m in trouble for retirement.

Should I just pay off the IRS debt now in full… or keep saving, while continuing to pay on the installment agreement?


#2

Hi, @sliddy, and welcome to the forum! in the same position, I’d be tempted to get the IRS off my back and then start power-saving for retirement. If you’re saving in a 401(k) or other retirement plan with a match, then contributing at least enough to get that full match is a good idea, but otherwise I can’t see much advantage in dragging out the installment agreement if you don’t have to.

The FIRE movement (financial independence, retire early) is mostly younger people wanting to retire super early, but you might find some inspiration and advice that’s helpful in getting you to a comfortable retirement in a relatively short period of time. Plus, here’s a column that might be useful: