Danny and Shante Quinzy have learned the hard way to separate their wants from their needs when it comes to spending. "We wasted thousands of dollars on stuff we can't even name," laments Shante. "We both were big shoppers, buying what we didn't need. It was nothing for us to spend an $8,000 tax refund on big-ticket items instead of saving." Fortunately, the Farmington Hills, Michigan, couple is sobering up from their spending party. They are ready to get their financial house in order. After all, their boys, 5-year-old Dante, and 19-month-old Donovan, are depending on them. "I'm trying to stop shopping when I'm bored ... I'm learning to walk away," says Shante. Over the past few years, the couple has used tax refunds to pay down some bills. They have also created and adhered to a family budget. It's not like the Quinzys aren't financially equipped. Shante, 34, is a project manager at General Motors, earning $68,000, and Danny, 33, earns $71,000 as a warehouse supervisor for DaimlerChrysler. Yet, they have only about $5,000 in savings and checking accounts, $37,000 in their 401(k) plans, and $3,000 worth of Circuit City stock. Meanwhile, they traded up their home last year, purchasing a $300,000, four-bedroom house. They recently refinanced, taking out a little more than $4,000 in cash to pay down some debt. The couple has roughly $60,000 in student loans, $20,000 in credit card debt, and $30,000 owed on a 2004 GMC Yukon and 2004 Pontiac Grand Prix. Doing better is not an option but a requirement if they hope to retire comfortably and save more money for their children's college education. Their "debt attack plan" includes further revision of their household budget. "We know there is still a lot of excess," says Shante. "We have to make hard choices and then use the money that's not being spent wisely on paying down our debt." The couple is disappointed but optimistic. As Shante sees it, "We're young enough to make up for lost time and we have good salaries to get us where we'd like to go." The Advice Larry Folmar of the Folmar Financial Group in Southfield, Michigan, talked with the Quinzys about their finances. "The Quinzys have made some sound financial decisions with regard to homeownership. But, there is still a lot to be done in order for them to meet their goals of liquidating credit card debt in five years, increasing contributions to their children's college education fund, paying off student loans in 10 years, and retiring at 55 with 401(k) accounts valued at least at $500,000. To help the Quinzys plug up the holes in their financial plan, Folmar offers the following suggestions: Stop giving Uncle Sam a free ride. The Quinzys are losing precious cash flow by overwithholding. "This is tantamount to giving the government an interest-free loan," says Folmar. The purchase of their new home last year resulted in higher interest costs but lowered their tax liability. Therefore, they can get the tax savings back into their paycheck by increasing their withholding allowances, says Folmar, who advises the couple to consult with their tax adviser. The potential increase in cash flow can be used to pay down debt and increase their emergency fund. Make debt reduction a top priority. At their current debt reduction rate, they will pay off their credit card debts in less than two years. When they do, they should switch their attention to the student loans. Their $60,000 debt can be eradicated within 10 years if they apply $750 to monthly payments. They should increase their student loan payments to at least pay the interest, adds Folmar. The good news for the Quinzys is that they will be able to lower their automobile expenses in a couple of months when the lease expires on one of their vehicles. "That money they spent on the lease should be shifted to increase cash flow for savings," says Folmar. Furthermore, as their incomes increase, they will have even more discretionary income. But, "they must resist the temptation to abandon financial and debt-management controls," says Folmar. Improve investing strategies. The largest percentage of the Quinzys investments is accumulated in their 401(k) plans. All of Shante's contributions are in her company's stock. She should maintain a position in company stock no greater than 15%. She is contributing only 3% of her income to her employer-sponsored retirement account. "She needs to increase her contributions and add other asset classes," says Folmar. Danny's portfolio is more diverse, with 30% in company stock, 40% in international, 20% bonds, and 10% cash. "Like Shante, he should reduce his company stock holdings to no more than 15%," says Folmar. He should also shift the mix to 10% to 15% international; 10% to 20% bonds; and balance his portfolio among other classes such as large-cap growth and value, mid- and small-cap, and real estate. Enhance preparations for the future. The Quinzys should use their contest winnings to shore up their emergency funds and should meet with an attorney about establishing a will and a trust. A will allows them to recommend to the courts their choice of guardianship in the event of their deaths. Other estate planning documents, such as a living will and a power of attorney, should also be considered. They say that they want to provide two years of college expenses for their sons. The Quinzys have a custodial bank account in their children's name to cover tuition and they plan to acquire savings bonds. However, with college costs currently escalating at a rate of 8% to 9% a year, they will need investments that keep pace. "At an inflation rate of 8%, it will cost $300,000 to provide for their sons as they would like," says Folmar. To achieve their education funding goal, they should invest in income mutual funds as well as blended mutual funds consisting of growth and growth-and-income fund categories. He recommends either a Coverdell Education Savings Account or a separate 529 plan (outside of the plan set up by the children's paternal grandmother). They should also consider the Michigan Education Trust, a prepaid college tuition plan under the 529 plan rules. Financial Snapshot: Danny and Shante Quinzy HOUSEHOLD INCOME Gross Income $139,000 ASSETS Â Value of Home $310,000 401(k)s 37,000 Savings and Checking Accounts 5,000 Stock 3,000 Value of Cars* 44,555 Total $399,555 LIABILITIES Mortgage $300,000 Student Loans 60,000 Credit Card Debt 20,000 Car Loans 30,000 Total $410,000 NET WORTHÂ -$10,445 *According to Kelley Blue Book.