Incomes: $60,000 and $62,000 a year.
Assets: House, valued at $500,000.
Monthly expenses: $612 creche fees; $591 car repayment; $150 private health cover; $229 store card debt; $120 sporting memberships; $134 rates; $300 utilities; $1000 for groceries, petrol, takeaways, fares, daily lunches; $100 Christmas club; and $2197 for the mortgage.
Savings: $5000 in mortgage offset account.
Debts: $320,000 mortgage, initially $330,000; $2000 credit-card debt (balance fluctuates but limit is $2000); $11,229 owing on car under a hire purchase agreement; and $4571 store credit card debt under a 24-month plan to buy a bedroom suite, interest free.
Goals: To accumulate some savings.
* Not their real names.

Ivan and Marika have combined incomes of more than $120,000 a year but find they always struggle to pay bills and credit card debts. They say they never seem to have anything left over and would like some financial guidance.

"If we have a debt we pay it off without a problem but we are not good savers," Marika says. The couple wonder if they should focus on paying off their house or contributing to superannuation.

"Super contributions will become an issue as we approach our 40s," she says.

Ivan contributes about $160 per fortnight extra (7 per cent of his gross wage) to super and they both have 9 per cent super contributed by their employers.

"We both intend working until we are 55 or 60 and hope to have adequate super to fund a modest retirement at age 60," Marika says.

"When our daughter reaches school age we would like to send her to a private school if we can afford it - initial fees would be around what we are paying for creche fees."

Ivan and Marika do not have an extravagant lifestyle and say that with a young child, their social life is somewhat limited.

"We have bought the house as an enforced savings plan but may have overextended ourselves," says Marika. "Can you give us some direction about how we can stop living beyond our means and get some money behind us for a rainy day?"

Anne Graham, a certified financial planner who is manager of McPhail HLG Financial Planning, an authorised representative of PACT Accountants Investment Group and a member of the Financial Planning Association, replies:

Marika and Ivan, given your ages and salaries, there is potential for you to have a financially sound retirement but you must start making plans now.

Try setting short, medium and long-term goals. For example, a short-term goal is to reduce consumer debt and enjoy a holiday; medium-term goal might be to furnish the house; a long-term goal is to own your home and build your retirement savings.

Based on the figures you provided, you have a surplus of about $5600 a year. You need to prepare a proper budget to account for those funds or stick to the budget you have. When budgeting, you need to set aside the money you planned to save, pay off the home loan and other bills and then allow for discretionary spending.

You need to set your priorities.

Reduce your credit card debt. I suggest you set up a direct payment authority from your bank account of about $180 a month and stop using the card. This will clear the highest interest debt in one year. You have a sizeable store debt. It is critical you repay this within the interest-free period or you will incur serious penalties.

Assuming you have a 100 per cent offset facility, you should leave your savings in the mortgage offset account for emergencies.

At this stage, I recommend that you concentrate on reducing your debt. When your other debts are repaid, redirect the surplus funds to your home loan.

I suggest you set a deadline to own your home. If you increase your payments to $1500 a fortnight, your home will be paid off by 2015. Owning your home outright will give you the freedom to pursue other options later.

You will not get access to any money you contribute to super until you are both 60. So focus on debt reduction first and start making serious salary sacrifice contributions to super when you are in your 40s and your debts are under control.

To have a reasonable income in retirement, you will need a lump sum of more than $1 million. It is much more effective to contribute $300 a month pre-tax through salary sacrifice than $180 a month after tax and the impact on your disposable income is about the same.

It is essential that you review your insurance cover, especially as you have a young family and outstanding debts. The cheapest way of getting income protection, death and total or permanent disability insurance may be through your super fund.

I would also urge you to get advice from a qualified financial planner.

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