Matt initially saw the plan as "limiting." But Jaime pointed out that once their debts were repaid, she could afford to be a full-time mom for longer.

"Once we talked about what it could mean for our future," Matt says, "I was more gung-ho than she was."

Step 2: Redo your budget

I've written before about how to stage a financial fire drill: Create a "baseline budget" of bare essentials such as food, shelter and utilities. It's a good idea to know how little you could live on if you had to, says CPA Sally Herigstad.

"Once you figure out the baseline budget, you can start adding (items) back to something you can live with," says Herigstad, the author of "Help! I Can't Pay My Bills!" and a regular contributor to MSN Money.

Starting in January 2006, Jaime and Matt allowed $300 a month for groceries and other necessities, plus $25 a month each for fun money. They dropped cable, reduced their phone plan and switched car insurance several times to get the best possible deal.

They sold Matt's beloved 1985 Jeep (he belonged to an off-road-vehicle club) and the almost-new Honda. The couple also sold off a ton of personal property, from musical instruments to a kayak. Matt sought website design jobs to bring in extra cash.

The fact that Jaime got pregnant a few months later lent a sense of purpose to their plans. "Once you're really both committed, it becomes a game," says Matt.

By the time their son Finley was born in December 2006, they'd paid off most of their debts and banked $23,000. Jaime received reduced pay during her three-month maternity leave, and that income also went to debt repayment. She ended her leave by returning to her old job for a little over a month, then gave notice when the last of the student loans was paid off.

If you are downsized involuntarily, implement a baseline budget right away.

Step 3: Live on the single paycheck

Those who plan to leave their jobs have the luxury of a trial run to track how well a single paycheck covers costs. According to Ellie Kay, the author of "Half-Price Living: Secrets to Living Well On One Income" and "The 60-Minute Money Workout," people often forget to factor in small or irregular expenses: oil changes, haircuts, piano lessons, birthday party gifts, auto repairs, class trips.

Click here to become a fan of MSN Money on Facebook

To build an accurate budget, Kay says, "you need to (scrutinize) your checkbook and your credit card statements -- those don't lie."

If you've lost your job, you have no choice but to live on a single income (plus unemployment, if you qualify). You do, however, have a choice about how you live: griping and feeling sorry for yourself, or framing this as a temporary setback.

"It's just for a season. It's for a very clearly defined goal," Kay says.

Certain expenses will go down. The nonworking spouse won't need a professional wardrobe and can help reduce costs by looking for grocery deals, cooking at home and caring for any children instead of paying for after-school or day care. Two-car couples won't spend as much on insurance if one vehicle isn't being driven to work every day. You might even decide to get rid of one car.