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stretch out those payments until the term is satisfied. The interest on $100 will be much more palatable than interest on $100,000.

4. Start Saving.

It does seem counterintuitive to save money when you're trying to claw your way out of debt. At this point, it's more about forming the habit than actually building a savings account. As you pay off debts, you can shift those funds into savings. In the meantime, save only what you can spare. If that is one penny, then one penny it is. ING Direct has a motto: "Plant pennies. Grow dollars." You can open an account with ING Direct here:

http://home.ingdirect.com /

The beauty of ING Direct and other banks like them are their interest rates. Credit Unions are also similar in that they offer more competitive rates than Citibank or Bank of America. Even if you don't have excess funds now, using ING's checking account as your main account will earn more interest on what you do have than it would at a traditional bank. The interest is extra money you can put into savings so it can continue to grow.

Now that we've looked at the expenses side of your debt management plan, let's look at the income aspect. Does it adequately cover every expense you've listed in your budget? If not, you can do one of two things:

Decrease your expenses
Increase your income

While both seem to be Herculean tasks, I assure you they're not. Most people go the route of decreasing expenses. Although, if you want to manage your debt and still enjoy life, simply increase your income. In this internet age, you no longer have to leave one job for a higher paying one elsewhere.

There are many websites where you can earn a passive income without quitting your day job. Helium, Associated Content and Caf Press are a few revenue generating sites available. It will take a little work upfront, but if you produce quality content, these sites will later generate an income stream with very little effort on your part. Remember, when you increase your expenses, you need to increase your income so that it remains 60% higher.

If you're too far in over your head and none of the above options will work for you, never fear. Help is available. Doing a search for any of these terms: debt management relief, debt help management, debt management credit counseling, debt management company, or debt management program will lead you to a number of companies who can structure a plan to help you get out of debt. In many instances, they can negotiate with your creditors to reduce your debt by up to 75%.

One of these companies, Money Management found at http://www.moneymanagement.org / - also offers educational tools so you can learn more about managing your debt on your own. In many cases, you can call your credit card companies to negotiate lower payments as well as lower interest rates yourself. This will cut out the middle man and insure that your payments reach your creditor on time.

Just be very careful about the company with whom you choose to work. Investigate them and use your instincts. Many consolidation outfits are scams that will only cost you more money in the long run.

While debt management is an enormous undertaking, it can be done. With the right tools like the ones mentioned above and the right attitude, you'll soon find yourself living a debt free life!

Learn more about this author, Lori Crawford.
Click here to send this author comments or questions.

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