While people toiling in debt may see bankruptcy as an option, there may be other non-bankruptcy options to combat debt as well. However, just like any other way to resolve a problem, there are good ways and bad ways to do so. This post will highlight some of the unadvisable methods that people use to combat debt and why you should avoid them.

Using retirement accounts to pay down debt – This is not advisable because you are essentially stunting the growth of your retirement fund to pay down debt. Also, you are using money that is protected from creditors in the event that you must seek bankruptcy protection. Further, the costs associated with withdrawing money from retirement accounts simply isn’t worth the risk. Most withdrawals include a 10 percent penalty along with your regular tax rate.

Paying debts out of order – Some people may not have the right priorities when it comes to paying debt. For instance, they may focus on paying credit card debt while sacrificing car loan payments or mortgage payments. This can possibly lead to more trouble than needed. By doing this, you may put secured assets at risk at the expense of unsecured debts.

Instead it may be better to think about what you need most and pay bills accordingly. So think about shelter, transportation and food, then other bills should fall into place.

Paying debts without a plan – It is also unadvisable to throw money at debt without a viable plan to pay it off. So if you are paying bills simply to make collection calls stop, you may want to consider an alternative.