Getting into debt is easy. A credit card purchase, a vacation, a medical emergency and before you realize it, you are unable to make your minimum payments. On the other hand, your money troubles may have hit you all at once following a job loss or divorce. While everyone’s path to debt is different, many people in New York share the goal of getting out from under the burden of debt.

If you have sat down with your bills and attempted to organize a pay-off plan, you may have felt overwhelmed. Falling behind on certain bills, such as your taxes or your mortgage, can have serious and rapid consequences, but every delinquent bill comes with a cost. The trick is to choose a debt payment option that does not make matters worse for you.

Protecting your future

You may be tempted to pull from every available resource to pay down what you owe, and this may seem prudent at the time. However, there are certain money sources that financial counselors would advise you to leave alone, including these:

  • Your home equity: Shifting unsecured debt to a home equity loan doesn’t really remove the debt and may leave you at risk of losing your home, especially if the interest on your loan is higher than what you paid on other debt.
  • Your 401(k): While your current debt is right here and now, borrowing from your future is not the way to fix it. You will lose valuable interest, pay double the taxes and risk the assessment of penalties.
  • Your emergency fund: Funneling your emergency fund to overdue bills may leave you vulnerable if your car breaks down or you become ill or injured.

If you don’t have an emergency fund, it may seem like the wrong time to grow one. However, even if you can only stash away a few dollars here and there, you won’t be caught off guard when the unexpected happens. It will save you from suffering the embarrassment of borrowing from friends or starting the debt cycle over by charging it to your credit card.

Finding trustworthy support

A common mistake people make when facing overwhelming debt is to fall for the false promises of a debt relief scam. These fraudsters may use methods of debt repayment that could damage your credit and place you in a more vulnerable position than before.

Even honest businesses cannot promise that your creditors will be willing to negotiate, and many debt relief companies rely on your feelings of desperation. The better path to take may be consulting a compassionate legal professional with experience in a variety of debt relief options.