4. Have a budget 

It might sound a little backward, but to make your debt-free plan work, you need to address the basics. That includes paying yourself first: put money into savings. Even if you're over your head in debt, you still need to save, just scale it back to a minimum of 5 percent of take-home pay while you focus on paying creditors. This is part of what's going to get you out of that debt spiral. You can segment that money as set aside for a future goal or emergencies. Then go into your budget and fine tune. Cut out excessive or unmonitored spending. Write down everything spend for a month or two to see where your money is going. After tracking, you'll start to see where things need to be reeled in and where you can shift funds.

"This is not a fun process," McClary says. "It's like flossing: Getting into and staying in the habit is the most important thing." Recording expenses as they occur is easiest. "Carry a small notepad and jot down quickly. Do it right away," he says. If you save receipts and compile them later it becomes a monster task and people give up.

Save receipts for all noncash purchases and use them to cross check your statements. "Don't go by what bank says," McClary says. "Cross-check their records."

This strategy isn't a debt diet, it's a healthy financial living routine. Even after you've erased or gotten debt to your optimum level, keep following these steps to stay out of trouble. Use this work sheet to set up your budget.