Table of Contents
We’re all very aware of the financial impact that Covid-19 has had on household budgets. From getting a reduced income to no income at all – it’s been a challenge. Here’s what you can do if you are living on a reduced income and are in debt.
Planned redundancies twice the rate of last recessionAround 380,000 job cuts were planned from May to July this year. Some researchers have predicted this could reach 735,000 this autumn.
Young people have been particularly hard hit, with those aged 16 to 24 suffering the biggest drop in employment compared with other age groups. With the government’s Job Retention Scheme ending on 31 October, these figures are set to increase.
I’ve lost my job and I’m in debt – what can I do?No matter what your situation, if you are struggling to make repayments or find yourself in problem debt then it can be very scary.
- The first thing you need to do is contact a free, regulated debt advice specialist like PayPlan.
- When you contact us, one of our advisers will help you to work out your household budget. That is everything you need to pay for and all of the money you have coming in. This will help our advisers to understand how much you have to pay towards your debts.
- Then, using credit referencing agencies, we’ll work out how much you owe and tell you all of the solutions that are available to you. Our advisers will be able to tell you the pros and cons of each solution, and which most fits with your situation now and in the future.
What happens when my circumstances change?
An informal solution, like a Debt Management Plan, can allow you to change payments if your income changes. No matter the plan, you should only ever pay the amount that you can realistically afford. Your plan should be reviewed annually or as your circumstances change.
If you’re worried about the risk of redundancy or have been made redundant then don’t panic. PayPlan’s guide to Redundancy and Debt talks you through what to do if you are in debt and are being made redundant. It includes:
Where can I get more information on redundancy rights?
- Your rights and where you can find more information on consultation periods, notice periods, redundancy pay and employment opportunities after redundancy
- Additional support such as getting your finances on track and where to go for expert support