José "J.M." and Tara Evans have learned the hard way to live within their means. The couple admits to being big spenders, taking trips to Belize, Puerto Rico, Cancun, and the Bahamas, as well as buying pricey clothes, gourmet food, and expensive furnishings. Debt is certainly a four-letter word in the Evans household. When the couple married three years ago, they owed a combined $40,000 in credit card debt; they now owe about $17,000. In addition to credit cards, the couple makes hefty payments on their college loans -- about $160,000 combined. "A lot of our expense was debt we ran up while we were in college," says J.M., a 33-year-old pharmaceuticals sales representative. Then there are the mortgages: their primary residence, a four-bedroom, two-and-a-half bath house, has a $175,000 mortgage. The condo Tara owned before they married (which the couple rents out), has a $92,000 mortgage. To top it all off, they owe $15,000 on their 2001 Mitsubishi Montero. J.M. has two sons, Tayshaun, a toddler, and Malcolm, 16, from previous relationships and he and Tara plan to have a child next year. Even with such a heavy load, the couple has good reason to be optimistic. J.M. started a new job last year and increased his salary from $60,000 to $70,000. He also qualifies for several company perks: He can purchase his company's stock at a 15% discount and drive a company-owned vehicle, which allows him to save money on gas and wear and tear on the family car. Tara, 28, works as a project manager with the Indianapolis Private Industry Council earning $52,000. Looking to boost their savings and investments, the Evanses recently started placing $650 monthly into a money-market account that has about $2,600. The couple is also taking steps to increase the $10,000 in their checking and savings accounts. "We're getting serious about saving," says J.M, who has more than $12,000 in an IRA and $10,000 in a 401(k) with his former employer. Tara has about $4,000 in her company 401(k). Recently, J.M. began using Intuit's Quicken software program to track family expenses and to determine how they are spending their discretionary funds. The chief culprit: fine dining in restaurants. The family has made an effort to tighten expenses. "We're doing better at sticking closer to our budget," says J.M. "We're on the right track now." The Advice BLACK ENTERPRISE tapped Michael Smith, a certified financial planner with ProFocus in Phoenix, to review the Evanses financial situation. "They're in the wealth-accumulation stage of their lives, but they also have a lot of changes on the horizon. The challenge will be for them to pay down debt, while increasing their liquidity and their savings," Smith explains. Smith outlined a path to help the Evans family reach their goals: Make debt a priority. Student loan debt of more than $160,000 won't go away overnight. "They will have to be patient and keep paying it down consistently," says Smith. With an increase in income, the Evanses can increase their monthly payments from $900 to $1,200. Doing so would allow them to pay off the loan in 11 years, freeing up money in time for Tayshaun's college finances; Malcolm, a 21st Century Scholar, can attend any public college in Indiana for free. As for the $17,000 in credit card debt, Smith recommends that the couple first pay off the card with the lowest balance and the highest interest rate until they have paid off all their accounts. Adopt smarter tax strategies. The Evanses should stop relying on Turbo Tax. "With their revenue stream, they need more advanced accounting," says Smith. "They need to get a CPA." Since Tayshaun is in day care, J.M. should take advantage of the cafeteria plan at his new job, which will allow him to have day care expenses withheld on a pretax basis. And if the Evanses take advantage of the depreciation of their rental property, they'll receive a $3,400 a year tax deduction, which should result in $1,067 in federal tax savings for them. Implement savings strategies. Since they are planning another child, they must scale back expenditures by eating out less. And because they rack up additional charges for exceeding their limits on their cell phones, they should switch to prepaid phones or find a plan that provides more minutes for less money. Increase investments. By all means, J.M. should buy his discounted company stock. Once he gets $25,000 worth of stock, he should diversify. Smith believes it would be prudent for the Evanses to divert $300 of the $650 they are putting into their money-market account each month into a small-cap value, mid-cap value, and global fund, with a no-load or low expense ratio. He suggests Vanguard Global Equity Fund, Third Avenue Value Fund, or Royce Opportunity Fund. J.M. should also consider redirecting the $370 per month he receives for child support into a 529 plan for Tayshaun. Moreover, the Evanses should max out the contributions on their 401(k)s and open a Roth IRA with their $2,000 contest winnings. Create an estate plan. "If something happens to J.M., his sons will go back to their mothers," Smith says. "With a living trust he can designate what funds should go to the boys and how that money is to be spent on them." A trust holds cash, securities, real estate, life insurance, and other assets that are transferred to a trustee on behalf of its beneficiaries. Smith suggests Tara act as the trustee of the living trust. J.M. also has $850,000 in term life insurance through his company. He should think about how he would divide that money between his two sons, while keeping in mind the needs of Tara and their future child. Financial Snapshot: J.M. and Tara Evans HOUSEHOLD INCOME Gross Income $122,000 (including estimated bonus) ASSETS  Primary Residence $182,000(market value) Rental Property $110,000(market value) Checking 5,200 Savings 5,000 Money Market 2,600 J.M. 401(k) 10,000 Tara 401(k) 4,000 J.M. Mutual Fund 12,422 Total $331,222 LIABILITIES Student Loans $163,000 valign="middle">Primary Residence Mortg. 175,000 Condo Mortgage 92,000 Credit Card Debt 17,000 2001 Mitsubishi Montero 15,000 Total $462,000 NET WORTH $-130,778