Home equity line of credits should not be used for day-to-day expenses (such as groceries) except in case of true emergency. Always remember you are borrowing against the equity value of your home and, in the worst case, your home could be foreclosed upon.

Home equity line of credits should be reserved for big-ticket items (such as home improvements or college expenses) with long-term benefits or for taking advantage of sound financial opportunities requiring quick cash availability. Some major purchases (e.g. cars or boats) can be financed with loans secured only by the asset itself often at very attractive rates. You should always explore these other options before deciding to use a home equity line of credit. Also, many boats qualify as second homes meaning the interest paid on a boat loan can be deductible without tying up your home equity.

Here’s a calculator that will help you decide.