Debt management is very important for individuals and organizations seeking to keep their financial obligations in order, and to pay off the debts in the most efficient and timely manner possible. One of the key principles in debt management is to prioritize your debts based on their significance, payment time lines, and the ability of the individual or organization to pay them. During the process of prioritizing your debts, payment time lines for your particular debts may be one of the most important factors in determining which debts you will pay first, as well as to allocate the most funding for. If possible, order debts so that the most overdue debts receive first priority, which will help to serve the purpose of preventing the payment of numerous charges which will certainly accumulate as a debt ages. Allocate your funding and seek to pay as many of the most overdue debts as possible, which will to buy time for you to pay some of the more current and overdue debts in a more timely manner.

Paying the most overdue debts serves the dual purpose of preventing those long-term debts from accumulating massive charges which will further hinder your ability to pay those debts, as well as preventing the more current debts from becoming past-due, which will forestall the accumulation of additional penalty charges as well as to maintain a good credit standing with non-past-due accounts.

The significance that some overdue debts hold to your organization are factors that must be considered in developing a debt management plan. Debts must be ordered based on the potential harm that they may cost the organization by non-payment, for example an organizations utility bill will take precedence over employee bonus payments.

Doing the formulation and development of a debt management plan, outside sources often used by individuals and organizations in order to develop a professional and efficient plan for dealing with their debt situation. Professional debt management organizations perform a professional analysis of the organization's budget, which includes factoring their income and expenses in order to develop a plan for negotiation with lenders. Once an organization's budgetary data is compiled and organized, debt management plan developers actively negotiate with lenders for lower interest rates on the debts, and payment plans that will be helpful to their clients. A very good debt management plan is based on the premise that individuals or organizations will pay as much in payments as can reasonably be expected from funding that is left after their priority expenses have been met.

Debt consolidation is one of the many methods, that is used by professional debt advisers to serve their clients interests. Debt consolidation is the process of taking out one loan in order to be able to pay off, or make payments on many other loans. This process is very helpful because it allows individuals or organizations to pay off their debts from making payments on one loan, which usually has a lower interest rate or provides a fixed interest rate.