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The average American household is carrying $9,600 worth of credit card debt, according to research. Paying that debt burden down will move at a slow pace as double-digit interest rate charges pile up and any mistakes made along the way could extend the time it takes to be debt-free.

In the video segment below, The Motley Fool analysts Michael Douglass and Nathan Hamilton talk about two mistakes cardholders may want to avoid when paying off credit card debt.

Michael Douglass: All right let's talk about mistakes to avoid when you're paying of credit card debt. Listen, debt happens. Things happen and you end up putting it on plastic. The key thing at that point is to figure out how to get that debt paid off as quickly as possible and a key part of that is to avoid mistakes so let's talk about the first one. Pay an annual fee.

Nathan Hamilton: Yeah with so much competition among credit card issuers, the annual fees have come down significantly so you as a borrower getting a balance transfer credit card can absolutely get some of the best offers on the market without paying an annual fee and that's a card that offers 21 months of 0% interest or 15 months or 12 months or nine months. Whatever it is. You can get a very good high quality balance transfer credit card without paying an annual fee. There's no need to do it especially when you're paying off debt and in the likely scenario that you're paying an annual fee. It's added to your principal, interest is charged on top of that, you're essentially getting two fees. The annual fee and interest as well.

Douglass: Yeah that just gets [inaudible 00:01:04] quickly and why spend the money if you're trying to save money. Then also, let's talk about treating all credit card debts equally.

Hamilton: Yeah so this is one you want to look at and say if you have multiple cards with debt on it, you want to look at your credit card APRs and say which one is the highest interest rate and put the most money toward paying that down and then once it's done, move it on to the other card. You're of course going to be paying the minimum payment on that the whole time but essentially what's called snowballing your interest charges. You take out the high cost debt first. Once it's paid off, use that extra money to pay off the lower interest rate debt and you can improve, you can decrease the number of years it takes to pay off your debt in many scenarios doing so.

Douglass: Yeah. That makes total sense.

Hamilton: Yeah.

Douglass: Yeah. Pay the least money you can basically is what it comes down to by saving money in interest charges. We've got a ... This isn't really like an official mistake but the fact of the matter is that ignoring balance transfer cards is often a mistake when you're in credit card debt because the fact of the matter is that if you can get that nine or that 12 or that 15 months interest free to pay off this debt, the money that you'd be spending on interest payments is money that you can instead apply to the principal and really get that debt paid off quickly. Fortunately we've got a lot of good information on the best balance transfer cards at so check us out there and we'll be happy to share the information all free of charge.

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