Jul. 21--The man was in his early 60s and was retired. His wife was a few years younger and still working.
     Despite their combined income of about $80,000 a year, they had amassed $92,000 in credit-card debt.
     But they were able to erase their debt in about 4 1/2 years by following a plan they developed with Consumer Credit Counseling. In short, they changed their lifestyles: No eating out, no vacations and no more credit cards.
     "They basically gave up their extracurricular life completely," said Rich Call of Consumer Credit Counseling in Columbus, who withheld ) their names to preserve confidentiality. "But they were committed to get out of it."
     Rising prices and stagnant wages are forcing many people to re-evaluate their monthly spending, but experts say those who succeed typically share one tool.
     "Have a freaking plan!" said Jonathan Fox, an associate professor of consumer sciences at Ohio State University. "Have some forethought. Project where you'll be in a year."
     The first step: Figure out in detail where your money is going each month by writing down everything you buy for several weeks.
     Then figure out how much you need to cut to meet your goals, whether they are to pay off credit cards, save up an emergency nest egg or avoid foreclosure.
     If getting a second job is out of the question, the third step is the tough part: making the necessary cuts.
     "People just need to understand their current situation: track the expenses and understand their current budget," said Kelly Paton, program coordinator for Family and Community Services, a Kent-based credit-counseling agency with offices in Newark and northeastern Ohio.
     "A lot of folks aren't able to say how much they spend in the week on gas in the car or how much they are spending on personal expenses. You can't control what you don't know."
     If you're "leaking cash" with lots of small purchases, then it's smart to reconsider those expenses along with the big ones, said Janet Bodnar, deputy editor of Kiplinger's Personal Finance magazine and an author on family finances.
     "You don't have to have cable TV. You don't have to have both a cell phone and land line. You have to decide what would you miss more, the lattes or the SUV. The point is, you have to decide what's important in your life."
     Fox, however, downplays the significance of changing small daily habits as a way to get out of a major financial mess. His advice: Think big.
     "There's always the classic kind of 'Don't get your latte'-type things, and to be honest with you, those examples kind of drive me crazy," said Fox, who teaches a course in personal finance. "If that (latte) can make you pretty darn happy, then great."
     Rather, Fox said, the big, fixed monthly expenses typically clobber people's personal finances. At the top of the list: the house and the car, which, according to the Consumer Price Index, account for 61 percent of Americans' total annual spending. (That figure includes related costs for fuel, maintenance and insurance.)
     That's a lot of lattes, and it represents the bulk of most people's potential savings, Fox said.
     For example, if you're spending 47 percent of your income on shelter, you need to ask yourself: Is this home creating 47 percent of my happiness, he said.
     Many people would be better off if they looked at shelter as a consumption item -- like a new TV or stereo -- instead of as an investment, Fox said.
     "Everything is changeable. Think: How can I get out of this?"
     Getting rid of credit-card debt is also key to freeing up cash, said Kathy Virgallito of Consumer Credit Counseling.
     The agency's average client in 2007 had income of $34,292 and unsecured debt, such as from credit cards or medical bills, of $21,418.
     After credit-card penalties kick in for being late on a payment or exceeding the debt limit, card companies can charge interest rates higher than 30 percent, she said.
     "More and more, people are really wanting to attack that credit-card debt so that they can free up money," Virgallito said.

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