Coronavirus is affecting people’s lives up and down the country, particularly our finances.
StepChange Debt Charity is the UK’s leading provider of free, impartial debt advice. As the experts, we’ve asked them for their top tips on taking back control of your finances in a year where so many of us desperately need help.
'I might get less hours at work, what support is available for me?'
With lots of businesses struggling with the impact of the pandemic, many people are seeing their hours reduced, and having to live on less money than usual. This is especially a worry for those who work in retail or hospitality, which are among the hardest-hit sectors.
If your hours have been reduced or you’re worried they might be, it’s a good idea to make a plan and think about how you will cope financially. We’ve put together a series of steps to help you handle a reduced income, deal with immediate worries and take control of your finances.
1. Check you’re getting what you’re entitled to
Firstly, if you’re still earning, make sure you’re getting paid correctly by your employer for the hours you are working. Dependent on your earnings you may also be eligible for benefits, and if you’re eligible, we recommend applying as soon as possible so that you’re not left short while waiting for your claim to be processed.
We have a free benefits calculator you can use to work out what help you’re entitled to.
2. Let your creditors know you’re on a reduced income
It’s important that you let your creditors know that you’re managing on a reduced income. It can be daunting, but they’re often more understanding than you might think, and could offer you a payment holiday or a pause on any interest and charges.
Most creditors are willing to be flexible and supportive to customers affected by the pandemic, but it’s important that you make them aware of your situation.
3. Make a budget
To take control of your finances, you need to know what money you have coming in, what your outgoings are, and how much you owe if anything. It can be daunting, but having a clear budget will help you spot areas where you might be overspending and can cut back, and can help you make sure you’re covering all of the things you need to pay for.
Our guide to budgeting can help you make an honest and realistic budget, and contains a template to get you started.
4. Work out how you can save money
When making your budget, you probably spotted areas where you could easily save a little money each month. Whether it’s subscriptions you don’t use or unnecessary online purchases (we’ve all been there), most of us could cut back on our spending and although we all enjoy a treat, being frugal can make living on a reduced income much easier.
Price comparison sites can help you save on things like insurance and utilities, our guide to saving money and boosting your income could help.
5. If you’re struggling, get in touch
Sometimes there just isn’t enough money coming in to cover your essentials, plain and simple. This can be very worrying, especially if you also have debts to pay. We can help you no matter how much income you have, and no matter how scary your situation may seem.
Visit StepChange for free, impartial and non-judgmental debt advice and solutions. We can help you get back on track with your finances and turn ‘what if’ into ‘what to do next’.