Jean Chatzky Money Coach

by Deborah Kotz, Special to AOL Coaches

If you’re riddled with debt and have no idea how to dig yourself out, take heart. Jean Chatzky’s 'Pay it Down!' offers a simple game plan to help get you back in the black. The hook: Put away $10 a day. If you apply that against an $8,000 credit card debt, you’ll be debt-free in 33 months. In 5 years, you’ll have a financial cushion you can depend on in case of an emergency.

Filled with anecdotes of real people who managed to pay down debt, this book offers solutions for everyone, no matter what the nature of the debt problem. One couple managed to lower their mortgage rate by 2 points -- saving $400 a month -- by closing 7 credits cards and getting outdated information wiped clean from their credit reports. Others had to completely revamp their lives and their spending habits to turn their financial situation around.

Regardless of your own money troubles, Chatzky’s 11 Step Plan can help you inch out of debt little by little. Like with a sensible diet, slow and steady is the way to go. Getting a handle on how much you spend per day, per month and per year is key. She recommends carrying a little notebook around for a day and recording every purchase you make from a pack of gum to a Starbuck’s latte. Most people, she says, don’t know where their money is going, and many are completely unaware that they’re spending more than they bring in each month.

You’ll get the in’s and out’s about credit cards like arranging for a lower interest rate on your monthly payments, consolidating debts and whether it harms you to have a lot of credit cards. (It does since it lowers your credit score, which means you’ll have a harder time getting a low interest rate on a loan.)

The book is filled with worksheets to help you track your spending and evaluate your fixed expenses. It also contains simple methods to “find the money,” the same way you do when you get a tax refund check. Refinancing your car loan and mortgage are obvious ways to find money. But did you ever consider consolidating your student loans? As a result of cutting unnecessary expenses combined with found money, you might wind up with more than $10 on the bottom line. If that’s the case, so much the better. You’ll be on your way to financial freedom that much faster.

1. Buy 'Pay It Down'