I think you should study up on personal financial planning. It may be time to see a credit counselor or even a bankruptcy lawyer.

If at all possible, a great way to spend less money is to go totally carfree. Even with a young family, this might be practical depending on where and how you live. Continue to read through this forum and check out some of the good books about carfree living.

How to Live Well Without a Car
Divorce Your Car