WARNING: You won't begin to get out of debt if you don't follow the advice. Only proceed if you are serious and motivated to get out of debt.

If you are facing financial troubles, the following steps will give you a good general plan to follow. Those that follow this approach have a greater chance of finding good solutions and leading happier lives in the long run.

1. Take a deep breath. You didn't get in debt overnight and you are not going to get out of debt overnight. Rash choices without clarity often lead to poor outcomes. Don't panic. If you need a brief break from the bills, take one. For the next few days, don't open your bills; just pile them in one place. In the meantime you should order a consolidated copy of your credit report to make sure there are not any surprise debts out there you don't know about. You can get your credit report online right now.

2. Don't make a budget. Sounds silly but it's true. If you haven't been tracking your cash, a budget is nothing more than a wish list on how you would like to spend your money and not based on your reality. Instead, beginning right now I want you to start tracking every penny you spend for the next thirty days. Let's figure out where the money is really going and then we can make some good educated choices about changes based on the real numbers. I think the best way to track expenses is by using the Ultimate Spending Plan book but if you don't want to use the helpful book then use a piece of paper and self-categorize the expenses at the end of the time and add them up. Make the process simple so it gets done.

3. While you are tracking your expenses I want you to do a financial review and examine your current expenses to see what can be easily adjusted to reduce your cost of services you currently use. I have put together an easy to follow step-by-step money saving process. You have no excuses for not doing it right now. Take the time to do it. I mean it. Why pay more for things you need if you don't have to. Every dollar saved is another dollar extra you don't have to earn.

4. Realize that experiencing a financial trauma is naturally very emotional. It is normal to experience denial, anger, bargaining, depression and acceptance. These are the same emotions that are normally faced in death and dying. The biggest danger is letting denial stand in your way and let too much time elapse before you come up with a real plan to address the situation. I'm not talking about days, a week or a month. Many people wait many months or years before taking action and that is too long. Time erodes options.

5. Get good advice. You cannot make the best decision for your specific situation with good advice.

   Getting good advice means even speaking to a bankruptcy attorney if your financial situation feels desperate. Talking to a bankruptcy attorney and asking questions does not mean you are filing bankruptcy. It is the best way for you to get a good understanding of all of your options so you can make a good decision that fits you.

6. I'm always here for you if you need to talk to a third-party and bounce some ideas off me or get my advice. I have no specific solution to promote and will give you my impartial advice on your situation.

7. There are two basic ways to beat debt. One way is to reduce expenses; the second is to increase income. I already gave you homework in step 3 to examine how much you are spending for services you already use. The tracking your expenses homework will give you good information about where the money is going so you can make some choices about those as soon as you are done tracking. But you can't forget about increasing your income. This might be a good time for you to review your current salary or even look for a new job. All of these links are right here.

8. Only you can decide what is most important to you in your life. When making choices about how to best get out of debt there is often no clear-cut answer. The best answer for you will involve consideration of your current life, goals, regrets, responsibilities and duties to protect family and loved ones. At this point in your crisis it would be harmful to move any possibilities off the table until all the homework is completed and data is available.

   Once your homework is completed and the information has been gathered then I encourage you to have a frank discussion with yourself and those you love about the realities of your situation. Encourage their input and advice and most of all listen to your heart. A little prayer never hurts either.

9. Decide the path that works best for you and implement your plan. Don't worry so much about the impact on your credit report, which can be brought back to life latter. You'll find some advice here on my site about that process.

10. Strongly consider professional financial management assistance. You are living through a very difficult time right now. Many people have found comfort and stress relief in letting someone else deal with the creditors and take over paying the bills. This can give you a much needed break so you can gather yourself together, rebuild strength and take back these responsibilities whenever you are ready to take them on again. I have been very impressed by these honest and caring people.