Once you have listed everyone you owe, determine how much you can pay each creditor and how long it will take to pay back each debt.
Generally, it is good to limit the amount of credit you owe (excluding your home mortgage) to no more than 10 percent of your monthly take-home pay.
If your family has $2,200 a month after taxes and tithe, try to keep your credit payments under $220 per month ($2,200 x 0.10 = $220). But if you already have numerous debts, figure out a way to use 25 percent of your monthly take-home pay for paying back your monthly debts. You usually need 75 percent of your income to maintain your necessary daily living expenses.
A family earning $2,200 a month probably needs to keep $1,650 ($2,200 X 0.75 = $1,650) for basic living expenses. That leaves $ ($2,200 X 0.25 = $550) for debt repayment.
If the minimum monthly payments add up to $696, for example, you must find ways to increase the money available for debt repayment.