With around 10,000 people per month predicted to seek IVA help or bankruptcy advice this year, consumers should start looking at their outstanding debt and prioritise which creditors should receive precedence.

Organising your debt into a hierarchy of importance will stop you from going to prison, losing your home or having to pay out unnecessary fines and summonses.

How do I know which bills are most important?

Mortgage and rent payments should always be paid on time and without fail. If payments do not remain up to date, the consequences are irreversible as you are more than likely to lose your home.

Gas and electricity bills also require immediate payment or you could find yourself without this necessity. Fuel companies are legally entitled to disconnect your supply and will not hesitate to do so if all attempts to reach payments have been exhausted.

Council tax should also be at the top of your list as non-payment can lead to a visit from the
Bailiffs or even a prison sentence. In some parts of the UK, residents are having their cars towed away if they do not settle outstanding council tax payments including late payment fees.

Maintenance payments to an ex-partner must also be kept up to date and prison is also a punishment for consumers who refuse to pay income tax, a TV license or VAT.

All of these bills should be paid first. However, if there is little left in the kitty after you have paid your primary utilities, an IVA may be a good way to help you make a little go a long way. IVA advice is available online or over the phone.