Here are the 7 tips you need to know when digging out of debt

NEW YORK (WABC) -- When digging out of debt, there are some things you should and some things you shouldn't do.

The average household carries an average of $15,000 in credit card debt. And if you've ever tried digging out from under that mountain, it can be overwhelming. But there's our 7-step plan to knock your credit card bills down to size.

If you have daunting debt do not be tempted to leverage your biggest asset.

"You could wind up losing your home," said Lauren Lyons Cole, a personal finance expert with TheStreet.com.

She said credit card interest rates are often super high. Lower home equity rates can lure homeowners into loans they can't handle. The No. 1 no-no -- never ever borrow against your home to pay off your credit cards.

"If you default on your credit cards, that's a bad thing. If you default on a mortgage payment, that is far worse," Cole said.

Another dumb move, according to Cole, is taking out "payday" loans against your paycheck. The strings attached are sky-high fees.

"The interest rates are abysmal. They could be anywhere from 300 to 600 percent. This is the type of decision you should avoid at all costs," said Cole.

Another source of funds to avoid is dipping into your retirement savings. Your 401(k) may sound like a better bet because you'd be borrowing and then paying yourself back.

"But if you get in a position where you're not able to pay it back you'll end up owing taxes and penalties on top of not being out of credit card debt," Cole said.

Her best advice to dig out of from under is to avoid paying only the minimum monthly payments. Doing so will keep you in debt for decades.

"If you add a little bit extra," said Cole, "even $25, the amount of time it takes will shorten significantly. So it's worth it to stretch a little further."

Another smart move? Pay off your cards with the highest interest rates first. Your interest rate is a direct link to the amount you have to pay each month.

"You'll see the minimum monthly payments will start to shrink," said Cole. "So this is positive because you pay less interest in the long run and your monthly payments will also decrease."

Consolidating debt can also save you interest, look for 0 percent interest balance transfer cards. Just be careful.

"You need to have a good credit score (to qualify). And also watch out for fees because sometimes the fees for the transfer can make it not worth it," cautioned Cole.