Saving when you’re broke and over 50 may seem impossible. You’re either still in work and trying to put whatever you can into your pension pot, or already drawing down from your pension for an income much lower than you’re used to.

Having no savings and a small income, and knowing your retirement is coming up, leaves many over-50s worrying about how they can save for a rainy day. We’ve come up with some solutions to help you build a savings pot even when you think you’re broke.

• Get the over-50s benefits you’re entitled to
• Put off retiring
• Create some over-50s savings
• Invest for the medium-term
• Pick up some over-50s extra earners
• Make extra savings
• Consider equity release

So, you’re over 50, feeling poor and see no hope of improving the situation? Stop right there because you have a lot more time – and opportunities – to turn this around than you might think. Don’t imagine that this is a time for you to slow down. No way – there’s too much of life to enjoy and, frankly, profit from.

Get started with our ideas on how to save if you’re broke and start building up that nest egg!

Get the Over-50s Benefits You’re Entitled To

Go to the benefits information website Turn2Us and fill in your details. It works out what benefits you should be getting. It also shows you how to apply for what you’re entitled to.

Also go to the benefits section of Gov.uk. They have a good list of the benefits and tax credits you could be entitled to. You could be getting tax credits if you’re not earning enough, or extra help if you’re caring for someone or have a disability. Get in now while you can – who knows how long these benefits and tax credits will continue!

Most benefits are now paid via the Universal Credit system. This means you need to apply online to get the benefits. If you’re not confident on a computer, make an appointment with your local Citizen’s Advice Bureau and they’ll help you. The DWP also has a Visiting Team who can come out to your home if you’re housebound or unable to claim your benefits online. They’ll make sure you’re getting everything you’re entitled to.

While you’re at it, it’s a good idea to check on your state pension situation. Do you have enough National Insurance credits to get the full pension? You need 30 years’ worth of contributions to qualify for the full state pension. Also, if you’ve been a carer or taken time off to look after children you will probably have National Insurance credits for those years. Find out what your situation is here.

Delay Your Retirement

This may not have you jumping for joy but you’re going to have to face it now: if you don’t have enough savings put by, you’re much better off working for a few more years than trying to live off the State Pension alone. The current full State Pension is £221.20 a week (£11,502 a year), and a recent report suggested a retired person needs a minimum of £14,400 a year and £31,300 a year to live comfortably.

Working more years gives you time to add to your pension pot – and means you’re not eating into your pension savings while you’re still working, too, leaving more for when you do retire!

There are various advantages to working longer anyway:

• You are more likely to live longer. Seriously. This is particularly true for men. Staying in work – or at least staying active and interested in life (which often comes with having to go out to work) helps keep us healthy. A study by BUPA found that survival rates improve with increasing age at retirement for people from all socio-economic groups.
• It’s a great way to meet people. Again, getting out of the house and into contact with others will cut down on feelings of loneliness, isolation or worthlessness which can be common in retirement.
• You could find a whole new lease of life. You don’t have to carry on doing whatever job it is that you do now. This is a great time to find a new career path and do something you’ve always wanted to do. For women fifty-plus, being a doula, for example, is a great new career. For men fifty-plus, one idea is to get into adult education, teaching the skills you’ve been using (and are probably still using) for all your career.
• You get to earn more. Once you’re over 65 you have a higher tax threshold and you don’t pay National Insurance contributions. This means that you get to take home more actual, real money from your salary. The Government doesn’t pilfer so much of it!
• Putting off claiming your State Pension means you could get a larger weekly amount when you do take it. Your weekly pension increases by 5.8% for every year you defer.
• Alternatively, you can choose to take a cash lump sum with interest instead, as long as you have deferred it for more than a year.

Don’t think that working past retirement age means you have to stay in the 9-5 rat race. Lots of shops and small businesses offer part-time work.

• Finally, claim your State Pension at the same time as working to boost your income. You can also use your State Pension to keep the same amount of money coming in each month but reduce the hours you work. Check your State Pension age to find out when

Go to this section on Gov.uk to find out about other benefits of putting off retirement.

Saving When You’re Broke: The Importance of Investments

Now this is the important part. At this stage of your life you need to be creating a stable savings base. You do have time to invest in more risky, volatile investments that should bring in a decent return year-on-year (see below for more information on how to do that) but at this point you primarily need stability.

Saving when you’re broke means working out where you can make cuts in your existing expenditure, or finding new ways to earn money. Even saving a small amount each month quickly adds up! Keep reading for tips on how to earn more money when you’re over 50.

This means that you should be concentrating on putting regular amounts of money (however small) into savings accounts and probably into gilts too. Check out our article on investing when you’re 50+ for more details – or keep reading for the quick guide below.

FIRST:

If you have no extra money each week/month to put into a savings account: take a look at our article on 26 ways to save with simple changes to your spending habits.

THEN –

Set up a monthly standing order from your current account into a savings account: Even if it’s just £20 a month, it’s still something going into a savings scheme for you. Choosing a regular savings account is a good option; the best ones offer a 12-month fixed rate of about 5% interest and won’t allow withdrawals – a good way to stop you being tempted to dip into your money!

FINALLY –

Don’t forget about your ISA allowance: you have £20,000 to save tax-free every year so make the most of it! Read on for information about investing in a stocks and shares ISA.

P. S.

There’s also gilts: That’s government bonds to you and me. These are effectively loans to the government where they promise to pay a fixed amount of interest each year in return for borrowing your money to pay for… well, goodness knows what they’re using it for right now!

The point about gilts as an investment is that they are also stable, like savings accounts, and although (like savings accounts) they don’t give a huge return, at least you know that your money is in relatively safe hands.

It’s not going to go up and down wildly in the short term like the stock market can do, but you could make fairly decent returns. Read our article on gilts here.

Do You Receive Universal Credit?

If you’re in receipt of Universal Credit, you could be eligible for their Help to Save account. If you are, it’s one of the best ways to squirrel away some extra cash – and get up to £1200 FREE CASH topped up by the Government. Read our article about Help to Save to find out if it’s something that you’re eligible for and how to apply.

Invest for the Medium-Term

If you have decided to put off retirement until you’re about 70 then you have a decent amount of time for slightly riskier investments to grow.

A word of warning! You have to be careful here. Although you have a good few years for your investments to grow and to take in the ups and downs of more volatile markets than, say, savings accounts and gilts, as you’re not in your twenties any longer you need to make sure that only a relatively small percentage of your money is going into these riskier products.

Saving when you’re broke and over 50 means the majority of your money should go into the stable savings, particularly if you are close to, or well into, your sixties now.

Stocks and shares: It’s still worth looking at stocks and shares if you’re in your fifties. Use all or part of your ISA allowance to invest in stocks and shares ISAs. Invest in a nice, cheap, easy index-tracking fund (tracker) such as the Legal & General FTSE 100 or FTSE All Share index tracker.

These go up and down with the stock market according to a clever computer programme. Trackers don’t charge much in the way of management fees because they’re run by computer so you get to keep more of the profits.

Pensions: Your employer now has to offer a pension scheme by law. You’ll have been auto-enrolled if you meet the minimum requirements – make sure to check you’re taking this pension scheme if you can!

The Government tops up your pension contributions, and your savings are put into the pot before tax – unlike money you choose to save from your pay cheque.

If you don’t have access to a company pension scheme, such as if you’re self-employed, you could set up your own private pension or two. The best types of private pensions are either stakeholders (cheap, easy, open to anyone) or SIPPs, Self-Invested Personal Pension (rather cleverer but a great idea if you have the confidence).

You don’t have to put any money in a pension but as it’s a good idea to spread your money around a few different kinds of products, it’s worth considering pensions as one of them.

Do remember that there are whole chapters on investing in stocks and shares, gilts, bonds, pensions and savings accounts in Jasmine’s ebook ‘Beat the Banks’.

Pick Up Some Over-50s Extra Earners

It’s all very well investing your money if you have some cash to spare, but what can you do if you don’t? Luckily there are plenty of things that over-50s can do to make extra cash on the side to make saving when you’re broke possible.

Tutoring

Can you play an instrument? Speak another language? Or have specialist knowledge of science or maths? If so then you can make money by teaching high school, college or even university students. Here at Moneymagpie we know this is a good way to make money, and we have known people who have made up to £35 an hour by tutoring GCSE students.
Consider placing an advert in your local community such as on NextDoor, or with a specialist website like FindTutors. Using an online site like this to advertise your services also means you can check out how other tutors are pricing themselves so that you know what to charge.

Become a doula

A doula is a someone who is paid to help a woman through her pregnancy and during her first few months after the baby is born. You do not need any qualifications to become a doula, but to give yourself some credibility you may want to join up to a website or agency that has a good reputation, such as British Doulas or the Scottish Doula Network. To learn more about becoming a doula read our article here.

Rent your spare room

If your children have all moved out, gone to university or you simply have a lovely big house, then you can make some extra money by renting out your spare rooms. You don’t have to turn your house into a hotel or B&B, just clear some cupboard and fridge space and make room for another toothbrush in the bathroom. Lodgers don’t have the same protections as tenants living in let properties, so you don’t need to worry about squatters or whether you can end an agreement early with your tenant if it’s not working out.

You could rent to students during term time if you live near a university, or to commuters Monday to Fridays if you live in a big city. If you live in a desirable area you could also rent rooms to tourists during the summer or at Christmas.

Spareroom is a really easy site to use and their basic package is free, just place an advert and wait for people to contact you. You can select what age and profession you would like your tenant to be so people don’t waste your time applying if they do not fit your specification. Of course, you can also do this through Air BnB, but the fees are notoriously large and it means a very high turnover compared to taking in a lodger.

Renting a room means you can earn up to £7,500 per year tax-free. Couples share this allowance, so won’t get twice the allowance for the same property. You can’t use this scheme if you’ve converted part of your home into a separate annexe: it has to be used for lodgers sharing facilities with you such as kitchens and living areas.

Rent other parts of your home

Make money from renting other parts of your home! If you have a large garden that you don’t or can’t manage, consider renting it to a local greenfingers as an allotment space. Your driveway and garage also earn cash when you put them up for rent on JustPark, Parklet and your local version of Gumtree or NextDoor.

Finally, with the rise of remote workers comes a rise in ‘digital nomads’ and ‘vanlifers’. You could rent out your living room as a remote working space for people who are travelling – make sure you have a comfortable desk and chair, and fast internet, and you’ll make cash while having some company around. It’s a double-whammy if you look for people who live the ‘van life’ as they tour the country, as you could rent out your drive for their overnight parking as well as your spare room to work from.

Become a house sitter

House sitting is, basically, looking after someone’s home while they are away. You get to stay in a house; to keep it clean, tidy, take phone messages and collect post, perhaps look after pets, and sometimes house owners are willing to pay you to stay.

This is where the over 50s and 60s can cash in. Websites like Trustedhousesitters ONLY let mature people sign up to their websites, as they want to reassure their customers that their house sitters are reliable.

So, even if you aren’t being paid to look after a house, it’s a good way to save money if you want to go on holiday, as you will be saving yourself the cost of accommodation.

Trusted housesitters also have houses all over the world, not just in the UK. So if you fancy a holiday abroad, you could save yourselves a lot of money by offering to house sit.

Saving When You’re Broke: How to Find Easy Savings

There are also lots of things you can do day to day that will save you money in and around your home.

Switch (or ditch) the car

Trade in the family car for a smaller, more wallet-friendly model. You’ll save money on petrol and insurance that way too. If you’ve ever been a member of the armed forces or health services, you could also be entitled to a special discount on a new car! Remember to shop around for your insurance each year too – don’t just accept the premium rise of your existing provider, as it can be easy to knock up to a few hundred quid off with some comparison and neogtiating!

Or, you could be brave and ditch the car altogether. Over-50s get discounts on public transport and if you really need a car for something, you could rent one with a scheme like Zipcar or Enterprise Car Club for cities outside of London

Shopping

Using a price comparison website like MySupermarketCompare can save you big money on your weekly food shop. In fact, MySupermarket says that they can help you save an average of £18 a week by comparing the contents of your basket to other leading supermarket stores.

Just pick your preferred supermarket from a choice of Tesco, Asda, Sainsbury’s and Ocado and start shopping. As you add items to your basket, the website will let you know how much you could save by switching to a different brand or product.

As your basket grows, MySupermarket also keeps a running total of how much you are spending, and how much it would be costing you at the three other supermarkets. So if a shop in Tesco were £10 cheaper than Sainsbury’s you could switch trolleys – genius!

Saving When You’re Broke is Easy with Cashback sites

While we’re talking about shopping, consider signing up to cashback sites like Topcashback and Quidco.

These companies are paid to drive traffic to retailers’ websites. You snag a share of that payment when you visit the online store you want by going via your cashback site first. For example, if you want to order your Marks and Spencer Christmas turkey online, log into your Topcashback site, search Marks and Spencer, and click the link. It’ll take you to the M&S website where you just shop as normal.

The cashback comes into your account a few weeks later. If you do this throughout the year for all of your online shopping activity, you can easily rack up a few hundred pounds of cashback without trying! You can pay out to your bank account or use the cashback to buy vouchers to spend online.

Become a mystery shopper

Get paid to eat, drink, shop, and go to the cinema (yes, really!).

All you have to do is sign up online and you will be sent details of where your next assignment will be.

It is your job to check that the standard of service is up to scratch, and write a short report about your experience.

Other ways to save or make money

We have loads more great ideas in our article on money-makers for over-60s, which are all relevant for over-50s too.

Also, our entire Make Money section is full of all kinds of different ways to make money on the side or even use your hobby or interest to give you a full-time earner. Start with our 10 easy ways to make quick cash article and move on to whatever takes your fancy!

If Saving When You’re Broke Seems Impossible, Consider Equity Release

We’re not especially keen on equity release for most people here at Moneymagpie. Although the industry is much cleaner than it was, it’s still not the safest path to tread. In many cases you get nowhere near the value of your property and if you have children it does mean that their inheritance will be drastically reduced.

However, if you have no children or you have no other means of supporting your retirement, then equity release could be something you might consider for later on. Seriously, though, don’t get into it until you are at least 65. Before that time, you should be using other means to create a nest egg for yourself. Equity release is a last resort (you get more for your home the later you leave it, anyway).

Use a company that belongs to the Equity Release Council, the industry regulatory body. Read up on it for as long as it takes for you to really understand what it involves and get independent advice before you jump in.

*This is not financial or investment advice. Remember to do your own research and speak to a professional advisor before parting with any money.

The post Help for over-50s: how to save if you’re broke appeared first on MoneyMagpie.

If you’re struggling to make ends meet, it’s only natural to turn to friends and family members for help by asking to borrow money. In fact, one TikTok user has gone viral as she revealed she now shares a bank account – with a friend.

But is it ever wise to lend or borrow money in this way? We explore the benefits and (very serious) pitfalls of unofficial lending, as well as provide some tips on how you can make sure both you and your friend or family member is protected if something goes wrong.

Read on to find out more, or click on the links below to go straight to that section.

• How much do people lend?
• The advantages of lending and borrowing among friends and family
• The cons – and the con artists
• What about shared bank accounts with friends?
• The legalities – and resources that can help
• Other assistance that is available

How Much Do People Lend?

Lending money to friends and family is more common than you might think. A third of people in the UK are currently owed money by friends and family, according to research by Starling Bank.

The amount being lent out by friends and family is not small change, either – 35% have lent more than £500 according to the survey of 2,000 UK adults.

Nearly one in four (23%) are owed more than £1,000, 10% have handed over £5,000 or more, and 6% have lent upwards of £10,000.

The Advantages 

Broaching the subject of gifting or loaning money to family may be embarrassing, but according to a recent survey of 3,000 people by Hodge Bank, many people actually get a kick out of helping their friends and family with money, with 58% of over-75s saying they liked to lend their loved ones money.

Of course, you don’t have to be a financial wizard to work out why people might want to borrow money from the ‘Bank of Grandma and Grandad’ (or the ‘Bank of Bob from Work’, for example).

Clearly, your friends and family are a lot more likely to give you some help towards bills than a bank ever is. Getting a loan is a bureaucratic nightmare, and unless a bank is confident that it will easily recoup its money, it’s not going to lend you a penny.

This preference for wealthier clients by the big banks is why those who are struggling often have to turn to ‘pay day’ loans, or even loan sharks.

Of course, if you aren’t considered a risk by the banks, they’ll happily give you a loan at a far more-reasonable rate than a rapacious pay day loan provider. But the terms are still unlikely to be anywhere near as generous as you’d get from friends and family.

Exorbitant rates

According to MoneyNerd, the average interest rate on a personal loan taken out in October 2022 with a two-year repayment was 10.16%, although many lenders charge much more, with rates as high as 36% or above.

The amount you are charged will depend on a number of factors, including your personal credit score, and your collateral (i.e. the amount of money/property the bank could theoretically seize if you fail to keep up with installments).

For help working out how much money you could realistically hope to borrow through official channels, see here.

The Cons – and the Con Artists

Needless to say, lending or borrowing money from friends and relatives isn’t without risks – for both parties.

Most ‘lenders’ are not particularly wealthy, according to Starling Bank, whose study found that a third of people who have lent money to friends and family are low-earners (i.e. on an annual salary of less than £20,000), while only 11% are higher earners, on £70,000 plus.

Embarrassment and anxiety

What’s more, two thirds of lenders told the bank that they felt either too “awkward and embarrassed” or too “anxious” to ask for money back that they’re rightfully owed, while a third of respondents (32%) said they had to ask two or more times for the money to repaid.

As Starling Bank’s chief banking officer, Helen Bieton, pointed out: “Talking about money with friends and family can be awkward, but letting debts rack up can take a toll on relationships and our own financial wellbeing.”

She added that “nearly one in five (17%) started to resent their debtors and 11% avoided making plans with them in the future”.

“When they weren’t paid back as swiftly as they would have liked, more than a quarter of people in the UK (27%) got annoyed, 8% got angry or had an argument with the person who owes them [money], and 3% ended up in a physical fight.”

Difficulties saying “no”

Of course, the easiest way to avoid such potential disputes is to just say no. However, this is easier said than done.

In July, a study from the short-term lending service Moneyboat revealed that the average Briton loses over £500 a year due to this inability to assert themselves with friends and family.

As Elizabeth Richie, a psychotherapeutic counsellor at St Andrews Healthcare, explained: “Expectations from friends and family can blur the lines when we want to say no! This may include fear of being judged, fear of being selfish.”

Richie, who helped Moneyboat with the study, said that it is crucial to set boundaries and be mindful of the fact that “we cannot control other people’s responses to us”.

“The ability or inability to say no often stems from our childhood. We will struggle to say no when we are constantly seeking approval, we will find it easier to say no when we have experienced healthy attachments in early life and have acquired a healthy identity from our early caregivers.

“Ultimately being able to say no at the right time reduces stress levels, and gives you time to prioritise what is important for you and to be more discerning about your own needs and self-care without feeling bad.”

Could your friend be a loan shark?

There are, however, far greater risks involved with casual borrowing than just hurt feelings, as Jackie Spencer, the senior policy manager at the Money and Pensions Service, explained: “Another thing to be cautious about is borrowing money from someone you know casually, such as a colleague or a friend.

“It might seem like a good solution, but you should consider how much you really know them, as they might be a loan shark who lends money illegally and the loan could cost you more than you think.

“They target people who need to borrow money and can’t access it from legal sources and may resort to intimidation and even violence if you can’t keep up with repayments.”

To help prevent this, she stressed that any informal loan should be put in writing, and recommended people read this guide on how to spot a potential loan shark.

Other issues to consider

While it can be tempting to ask friends or relatives to lend you money, you need to think about not only whether you can afford to repay the loan but what might happen if you can’t.

People thinking of borrowing from friends and family really ought to draw up a budget using a resource like this, just like someone would do before approaching a bank for a loan.

“This will help you see how much money you have left for repayments and if you can actually afford it,” said Spencer.

“You should also consider the risk that this could harm or even end the relationship if the money is not repaid. It’s stressful enough if you can’t afford to pay back what you owe, but it can be even worse when you’re leaving a loved one out of pocket.

“If you’re not sure whether you should borrow from a friend or family member, there are other credit options – even if you have a poor credit rating and if you’re struggling with debts, there is help available through our MoneyHelper service.”

What to do if you are approached for a loan you can’t afford

It can be hard to refuse when a friend, partner or family member asks for financial help, but you should consider whether you can cope with the impact of not having the loan repaid. Take the time to work out your own budget before lending to anyone.

If your money is currently in savings, you’ll need to bear in mind that removing a large chunk of this will affect the interest you make each month.

What About Shared Bank Accounts with Friends?

As the cost of living hits us all, more and more people are considering setting up shared bank accounts with friends. Much like in a couple, they pay in part of their salary each month and use it to pay bills if they live together, or to save towards a shared goal like a holiday. So, instead of lending each other money back and forth (we’ve all asked for an extra tenner here and there from our best mate), their spending comes from the shared account.

A new viral trend on TikTok, shared bank accounts are being touted as a way to find accountability in your spending, as someone else can see everything you spend.

While sharing a bank account for housemates to pay bills together might be useful, it comes with big pitfalls. The funds aren’t protected – so anyone named on the account can take the whole lot at any time. In the example of TikTokker Caitlin above, she and her friend don’t always pay in equal amounts either, as sometimes one earns more than the other. This is the highest level of trust, because anyone in this situation could run off with the money they haven’t earned!

More than that, if your friend has a terrible credit score, or they put your joint account into debt, your credit rating will be ruined, too.

Joint savings accounts can work better and some banks recognise this. Monzo has a shared saving account that helps friends save together into one pot for a specific event like a holiday or hen do. However, the funds are still there for anyone to spend and your credit rating is now linked to the people named on the account.

If you want an accountability buddy to help control your spending in tight times, you could always set a weekly date to meet with your friend and go through your bank statements together. This will make sure you know someone else is going to look at your spending, helping you to curb impulse and unnecessary expenditure, without risking your funds being withdrawn by someone else.

The Legalities – and Resources That Can Help

If you are able to help a friend or relative in need, it’s still wise to take some legal precautions to safeguard both you and your loved one in case of unforeseen circumstances.

As Spencer from the Money and Pensions Service pointed out, it’s a good idea to put your agreement in writing so both parties were aware of exactly how much will repaid and when. “It’s also important to keep records of when repayments are made, so you both know how much is still outstanding.

“Having an agreement in place can protect you in unforeseen circumstances as well, such as if the borrower died with the debt unpaid as you’d need proof to claim from their estate.”

Legal templates

You can find lots of free template agreements online that both parties can sign and keep.

LawDepot has a very easy-to-follow, one-page form that should leave both sides in no doubts as to what was lent, and to whom. You can download it here.

Things to consider in any agreement 

The team at Hodge Bank has some great advice on things to consider before lending to friends and family. For instance, they suggest you should include details such as “a time frame for when the sum is expected to be paid back by, any interest (if applicable) and any consequences for missed payments – you may choose to set a fixed penalty or an interest charge for example.”

The bank also tells would-be lenders to consider things like collateral, adding: “If your friend or family member has anything of worth, this can be a good way to ensure your money will be returned to you.

“If your money was in savings prior to the loan, it may be a good idea to charge at least as much interest as it’d earn in savings to make sure that you don’t lose out. This will also ensure that the loan is seen as a loan and not a gift.”

Tax implications

Another issue many people overlook is the tax implication. If there’s interest being added to the repayment amount, you really ought to inform HMRC and fill out a self-assessment form as, depending on your income, the interest on any repayments may be liable for tax. Obviously, if you’re not charging interest, you won’t need to tell HMRC and, instead, just need to keep a detail of the loan and repayment amounts, in case you’re challenged about where the money came from.

Of course, it’s worth pointing out that many relatives (especially older ones) loan out money on the understanding that they probably won’t need it to be repaid.

It’s worth pointing out, however, that if the lender dies within seven years of giving the money away, the recipient may have to pay inheritance tax on it. For more information about inheritance tax, read our guide on estate planning.

What to do if there’s a dispute 

When lending to family and friends, there’s always the chance that they might not pay you back. If this happens, the first step is to talk to them and find out why this is. It may be due to something simple like a change in personal circumstances or other reasons beyond their control.

If the issue is due to a lack of funds, you should try to come to an agreement to amend the payment schedule or increase the length of the loan-period. If your friend or family member is being difficult and there’s a signed agreement in place, you can always seek legal action, if necessary.

For sums below £5,000, you have the option of taking the issue to a small claims court. For larger amounts, you may need to seek legal advice on how best to proceed.

Other help out there

If you or your loved ones are struggling financially, you really should try to reduce any debts and do everything you can to consolidate your finances before complicating the situation with yet more IOUs.

Charities like Christians Against Poverty give free help and advice to people struggling to keep their head above water financially – irrespective of their religion.

Its advisers should be able to help you cut your budget and get lenders off your back.

They work very closely with local Council Tax and Business Rates’ enforcement departments to create more-manageable payment plans for people who’ve fallen behind and are racking up court fees and penalty notices.

They also help arrange Individual Voluntary Arrangements, Protected Trust Deeds and Debt Relief Orders to clear any money you owe private businesses.

The charity has helped more than 20,000 become debt-free since 2010 alone, so they know what they’re doing.

You could also try Citizens Advice or Turn2us, who can not only provide some advice on clearing debts and dealing with angry lenders, but could also point you in the direction of benefits or other assistance you may not know you are eligible for.

More information

If you are struggling during the current cost-of-living crisis, you may find the following articles of use:

• 9 quick ways to organise your finances
• Mental health and money: How to stop debt overwhelming you

MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of lending or borrowing money should conduct their own due diligence. 

The post Is it wise to lend or borrow money from friends and family? appeared first on MoneyMagpie.

What is the Fund?

You Pay: We Pay Scheme

Money Advice Services

Energy Grants

The British Gas Energy Trust – For Anyone

What is the British Gas Fund?

British Gas allocated £140m to support households and small businesses with education about energy saving tactics, grants to help with energy debt, and their unique You Pay: We Pay scheme to help people avoid financial difficulty with energy bills.

Since 2021, the fund has already helped 21,000 customers with average grants of £2,000 to write off energy debts. It has also set up additional regional advice services, invested in more customer service representatives to reduce call times and improve communication with customers struggling to pay their energy bill, and set aside £15m to help small businesses like pubs and shops with rising costs.

You Pay: We Pay Scheme

This is a unique scheme as part of the £140m British Gas fund, not offered by any other energy supplier. It is designed to help you get out of or avoid energy debt if you’re struggling with your bills, by incentivising you to pay something towards your bills each month.

British Gas will then match what you pay towards your bills – so if you pay £100, so will they, meaning you’ll get a total of £200 paid towards your energy bill. This is a six-month scheme starting from June 2024, so that would mean £100 a month paid by customer over six months (£600 total) plus a further £600 matched by British Gas. This is a brilliant scheme designed particularly for households who have built up some debt on their account and are struggling to pay it off.

Eligible customers will be identified and contacted by British Gas, so you don’t need to do anything to apply.

Money Advice Services

As part of its commitment to improving financial outcomes for households of their customers, British Gas has also used some of the large fund to invest in financial education and money advice services across the UK.

These hubs are designed to give people control over their finances by providing free education about money management and energy saving tips to save on their fuel bill even if costs rise again. Some hubs are specifically run by British Gas, while others are within local Post Offices with advisors fully trained by the fund.

Energy Grants

Some customers struggling with energy debt will be able to access up to £250 credit grants towards their bills – which means they won’t need to pay it back. British Gas is identifying the customers suitable for this scheme, which uses £10million of the total fund money, so you don’t need to apply.

If you think you might need their help and haven’t had information from them, however, get in touch with them. The first step to preventing or sorting out energy debt is to talk to your energy supplier – and this will help them to know that you’re struggling to pay your bills. Many people will prioritise their energy bill over other costs, so it appears to their supplier that they aren’t in financial difficulty. Highlighting your difficulty with your energy supplier is the first step to finding out what schemes and grants you could be eligible to claim.

The British Gas Energy Trust – For Anyone

Even if you’re not a British Gas customer, you could get help from their independent charity, the British Gas Energy Trust. Families and individuals facing fuel poverty can apply to the Trust for financial support in the form of grant to money management tips and energy saving advice.

The Trust has been around a long time – in fact, this year is its 20th birthday. To celebrate twenty years of the charity, British Gas have donated an extra £20million to the charity – taking their total contribution to helping fight fuel poverty to over £200million in twenty years.

The post Could British Gas’ £140m Fund Help You? appeared first on MoneyMagpie.

In the past few years there have been substantial changes to disability benefits and support available. Below is a helpful bank of information, where you can find out what you may be entitled to claim, the amounts you can receive and how to apply for each.

• • Working age – 18+
    • Employment and Support Allowance (ESA)
    • Personal Independence Payment (PIP)
    • Television Licence Discount
    • University Student
  • Retirement age – 65+
    • Attendance Allowance (AA)
    • Television Licence
  • Benefits for carers
  • Carer’s Allowance (CA)
  • Carer’s Assessment
    
  • Other sources of financial help
  • Council tax discount
  • Housing benefit
  • Disabled facilities grant
  • Blue badges
  • Motability
  • Water Sure
  • Warm Home Discount Scheme

Working Age 18+

Universal Credit Disability Allowances

Previously, Employment and Support Allowance was a separate benefit you could claim for short-term or long-term disability. With the national rollout of Universal Credit, most ESA claims now form part of a UC claim instead.

ESA is paid every two weeks instead of every four weeks for Universal Credit, and is not means-tested (which means it is not linked to your income). If you apply for ESA and Universal Credit, your ESA counts as income so your ESA payment will reduce your Universal Credit payment.

ESA counts towards your Class 1 National Insurance payments, which entitles you to other benefits. Universal Credit only counts as Class 3 NI, which means it only contributes credits towards your State Pension.

You might also be better suited to not claiming ESA and instead applying to be in the Low Capability for Work and Work Related Activity group on Universal Credit, if you have a long-term health condition that prevents you from working. This entitles you to more Universal Credit.

New applicants of UC can apply here: visit the government web page.

During your application you’ll need to provide the following information:

1. National Insurance number.
2. Medical certificate from your GP or doctor.
3. Your GP’s office address and telephone number.
4. A contact telephone number.
5. Up to date mortgage or landlord details if applicable.
6. A recent council tax bill.
7. Your last employer’s address and telephone number, with your start and end dates of employment.
8. Bank or building society account number and sort code.
9. Details of any other income you currently receive.
10. Details of your savings.

Once you have officially registered your claim, you’ll then be asked to complete a short claim form so that it can be properly assessed. You may also be invited to a face-to-face Work Capability Assessment.

The decision maker will then write to you to confirm if application is successful and, if so, whether you have been placed in the Work-Related Activity or Support Group. There is also an appeal process in place. This is if your application is rejected and you’d like to challenge that decision.

How much?

How much you receive will depend on your personal circumstances, such as your other income and how much you have in your savings.

There are different standard amounts depending on your age and whether you live with your partner. If you live with your partner, their income is considered in your claim and you must make a joint claim (even if your partner is not seeking benefits).

ESA Payments

For the first 13 weeks (the assessment period), you will receive either £70.70 a week if you are under 25 years old, or £90.50 if you’re over 25. This increases to £90.50 if you’re in a work-related activity group (which means you should be looking for suitable work), or £138.20 if you are in the support group (which means you don’t have to look for work). You can only take on permitted work for a limited number of hours each week.

Universal Credit Payments

Paid monthly, Universal Credit has different age and circumstance brackets.

Under 25 and single: £311.68 per month

Under 25 living with your partner: £489.23 for you both (if they are not low income, your amount may be reduced or you might be ineligible to claim)

Over 25 and single: £393.45 a month

Over 25 and living with your partner: £617.70

You might get additional housing allowances to help with rent, and extra allowances for having children.

Your disability element is on top of the figures above. If your Work Capability Assessment puts you in a group with Limited Work Related Activity, your amount is an extra £416.19 a month. So, let’s say you’re single, over 25, and it’s decided you don’t need to look for work due to your disability, the minimum you would receive each month is £809.64 before any housing or child allowances.

You are not limited for working while claiming Universal Credit and the disability allowance, but when you earn over a certain limit, you lose 45p for every £1 you receive from work.

Personal Independence Payment (PIP)

Personal Independent Payment replaces Disability Living Allowance (DLA) for all new applicants aged 16 to 64. PIP recognises that disabled people incur extra costs in their daily lives. This can influence how much you may recieve.

To make a new claim telephone 0800 917 2222.

You’ll need to provide the following details in order to make your claim:

1. Contact telephone number
2. Date of birth
3. National Insurance number
4. Bank or building society account number and sort code
5. Your GP’s name and contact details, plus those of any other doctor or health worker whose care you are under
6. If applicable, dates and addresses of any time you’ve spent in hospital, in a care home or abroad.

The DWP will then post a long ‘How your disability affects you’ form to fill in. The questions take the following into account: your mental health, learning disabilities and physical impairments. If you need help filling out the form, ask your carer, friend, or contact the Citizen’s Advice Bureau.

Once the DWP has received your form, an independent health professional may invite you to a face-to-face meeting, either at an assessment centre or your home. You’ll be asked about your ability to carry out daily activities and how your condition affects your life in general.

The representative will then write to you to inform you if you have been successful or not. They will also confirm the level of benefit you are entitled to receive. However, if you are rejected do not agree with the decision: you can enter the appeal process.

How much?

There are two parts to PIP: mobility rate and daily living. Qualifying for one does not automatically qualify you for the other. Both parts have a higher and lower rate, and which one you receive depends on your assessment outcome.

Mobility lower rate is £72.65 a week and higher rate is £108.55 a week.

Daily Living lower rate is £28.70 a week and higher rate is £75.75 a week.

Television Licence Discount

People in the UK who suffer from a visual impairment or blindness can apply for a 50% discount on their television licence. This usually costs £169.50 but with the discount it is £84.75.

Remember, this is for the whole household to benefit from. So if you live with someone who is blind and they are not aware of this, then they should consider applying.

If the licence holder is over 75 years old, regardless of whether they have a disability, and they receive Pension Credit, a TV Licence is free.

Full details are here.

This podcast explains the process in audio.

University Students

Disabled Students Allowance (DSA) is available for full and part-time students at undergraduate and postgraduate level. It’s designed to cover some of the additional costs that students who have mental health problems, long term illnesses and other disabilities may incur.

Examples include covering the cost of specialist equipment, and non-specialist equipment, non-medical helpers and travel costs. What it doesn’t cover is day-to-day costs every student has, such as groceries and rent.

The rate you receive will depend upon an assessment of your needs. Your university will have their own way of doing things, however it never hurts to inquire and find out for certain.

To apply:

• England apply via  Student Finance England
• Scotland apply via Student Awards Agency Scotland
• Wales apply via Student Finance Wales
• Northern Ireland apply via Student Finance Northern Ireland

If you are training for a medical degree such as nursing or as a GP, you can apply for NHS Disabled Student Allowance as an additional payment with your bursary.

Retirement Age 65 +

Attendance Allowance (AA)

Attendance Allowance is a benefit for people over the age of 65 which is intended for those who have from severe health problems. They may require someone to stop by regularly and help them with their daily tasks, helping to look after them in any way that may be beneficial. However, you do not need to be using or employing a carer to apply.

There are two rates, lower and higher, depending on the level of help needed. AA is not means tested.

To claim telephone 0800 731 0122.

How much?

For the 2024/25 tax year the weekly rates are:

• Lower rate: £72.65
• Higher rate: £108.55

And you may also be able to receive other benefits such as Pension Credit and Housing Benefit to help further.

Benefits for Carers

Carer’s Allowance (CA)

People over 16 living in England, Wales or Scotland who care for someone for at least 35 hours a week may be eligible for Carer’s Allowance. This is if the person they care for also receives:

• A daily living component of PIP
• The middle or highest care rate of DLA
• Attendance Allowance.

To claim, fill in the online form. You’ll need the date of birth, name and address, national insurance number (if they’re over 16) and DLA reference number (if they’re under 16) of the person you’re caring for.

You’ll also need your own NI number, bank or building society account number and sort code, P45 or current employment details.

In Northern Ireland the rules are slightly different.

If you are not eligible for CA, then you may be entitled to Carer’s Credit instead. This is a national insurance credit for those caring for someone for at least 20 hours per week. For information, read here.

How much?

For the 2024/25 tax year the weekly rate for Carer’s Allowance is £81.90.

Carer’s Assessment

It’s important that the needs of the carer are not overlooked. After all, they need to be fit and healthy in order to function effectively as a carer. Carers are entitled to a free Carer’s Assessment from their local authority.

This assessment will review your situation and ascertain what practical support you may be entitled to. It’s important that you are honest about the impact that your role as a carer has on your life, health and ability to work.

To arrange a carer’s assessment, contact your local council’s adult social services department. Carer’s UK has useful factsheet on how the process differs in England, Scotland, Wales and Northern Ireland.

Other Sources of Financial Help

Council Tax Discount

If you have a disability, your local council will tell you if you are eligible for a council tax discount. People who are severely mentally impaired; who have a live-in carer who isn’t their partner, spouse or child, aren’t included when working out a council tax payment.

Those who live in a larger property because to their disability needs, and require the extra space for use of a wheelchair or an extra bathroom/kitchen, may also be eligible for a discount.

You are responsible for applying to your council for the discount. To find your local council’s website type in your postcode on this Government web page.

Housing Benefit

People who are on a low income can apply for Housing Benefit to help with their housing costs. Couples of working age living in social housing who cannot share a bedroom for health reasons, and disabled people who require an extra bedroom for overnight care, may not have to pay the spare room subsidy. This is commonly known as the bedroom tax.

To see if you’re eligible and to apply go here.

Disabled Facilities Grants

Local councils can grant money for disabled people who need make changes in their home. This can help to make their living arrangements easier for them. Services such as widening doors for wheelchair access, installing a stair lift and ramps are all things that are included.

Contact your local council for eligibility information and how to apply.

Blue Badges

Blue parking badges are available for qualifying disabled people. They allow holders to park in marked disabled spaces without charge (or at a reduced fee) in most pay-and-display car parks. They also allow holders to park on single and double yellow lines for up to three hours, so you can park closer to a venue (but you can’t block traffic or cause a danger with your choice of parking position). The badge is for you and the car you’re travelling in – so it can be used for any car instead of being registered to a single one. You can’t give your badge to anybody else, the exception being if they are coming to pick you up or drop you off at the location.

Historically, only people with difficulty walking have been eligible for a blue badges. However, the government recently extended this to people with mental health conditions too. Conditions such as dementia and autism may also be covered.

England, Wales, Scotland, and Northern Ireland have different ways to apply. See here.

Motability

Disabled people who receive the highest level of PIP’s mobility component are automatically entitled to apply to Motability. This is a scheme which enables customers to lease cars, scooters, powered wheelchairs and wheelchair accessible vehicles at a lower cost.

For further information and how to apply visit their site.

Water Sure

If you have a condition that requires a heavy use of water, such as a serious skin condition or extra laundry due to incontinence, you could apply to your water supplier through the Water Sure scheme for a discount. If you live with a large number of school age children, you could also be eligible even if your medical conditions don’t use extra water.

Find out more here.

Warm Home Discount

People on a low income or certain disability benefits qualify for the Warm Home Discount. This is an extra payment on your energy bill of £150 during winter, to make sure you can afford your heating and energy bills.

Each supplier has their own criteria; however all suppliers must accept certain people onto their scheme. Find out more about how to get the warm home discount here.

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The Carer’s Leave Act

Who is Eligible for Carer’s Leave?

How Does Carer’s Leave Work?

Working Out Carer’s Leave Entitlement

How is Carer’s Leave Different to Emergency Leave?

Is Parental Leave Part of Carer’s Leave?

Other Benefits for Carers

The Carer’s Leave Act

Passed in 2023 but officially in force from 6th April 2024, the Carers Leave Act entitles anyone with a caring responsibility for a dependant to take unpaid leave for care duties. This might include taking them to hospital appointments or providing care cover for short care staffing, or visiting residential care to find somewhere for them to live longer term.

Some companies already have carers leave as part of their policies, which means you might be able to be paid for care-related duties. But, if your employer does not allow time off for care activities unless you use up your annual leave allowance, you’re now legally entitled to unpaid care leave that doesn’t take away from your paid holiday allowance.

Who is Eligible for Carer’s Leave?

The definition of eligibility is quite broad. The person you care for can be a partner, spouse, sibling, child, other relative, or unrelated to you. You might care for them many hours regularly each week or on an ad-hoc basis when you’re needed.

Carers leave is for any salaried employee – unfortunately, like other holiday allowances, self-employed and freelance workers don’t get the benefit (although, of course, if they take a day unpaid off work for care duties it’s just the same!).

It is important to note that, when applying for carer’s leave, you do not have to reveal the illness or disability of the dependent you care for to your employer – nor do you need to be a blood relative or spouse to be considered a carer (so it could be for a friend, too).

How Does Carer’s Leave Work?

You’re allowed to apply for Carers leave from the day you start a job – there is no minimum time you have to work before applying.

It is an unpaid leave, so before you apply for it check your contract and company handbook in case your employer offers paid leave for carers outside of their holiday entitlement. You must apply for the leave – it’s not an emergency leave.

If you are asking for a half day or single full day, you need to apply at least three days before you need to take it. For anything above a single day, you must request the leave at least double the length of time for the leave. For example, if you need two days you need to apply four days before, if you need three days it would be six days before.

Working Out Your Carer’s Leave Entitlement

Carer’s leave entitlement is based upon how many days you work in the week. You can take up to one week of leave per calendar year, from the date of the first request. You don’t have to take all of the days at once, so it could be up to ten half days across the year if you work full-time.

If you work five days a week, you will be entitled to the full working week’s allowance. If you work part-time, say three days a week, it would be three days a year entitlement. For people who work irregular hours, they can work out their leave by adding up the total hours worked in the last 12 months and dividing by 52 to get the equivalent week’s allowance. If you started your job less than twelve months ago, divide your total hours by the total number of weeks worked to date.

An employer cannot legally refuse carer’s leave – but they may delay it, if they have reason to believe your absence could cause significant business disruption. If this happens, they must give you a date within one month of the leave date requested, and they have to write to you at least seven days of the original request.

Your employer also can’t change their mind after granting carer’s leave after seven days from the date you requested it. So, if they say yes to it on Monday and change their mind on Thursday, they’re within their rights to do so as it is less than seven days. But if you requested it on the 1st of the month and they decide to refuse on the 10th, that’s not permitted as it is over seven days from the request.

How is Carer’s Leave Different to Emergency Leave?

Carer’s leave is for planned events, such as hospital appointments or if the dependant’s usual care staff are taking their own annual holiday and need cover.

Other types of leave you can apply for might be emergency leave. This is unplanned and often unpaid leave, given at your employer’s discretion (but cannot be reasonably refused). It might be, for example, if your child is unwell and cannot go to school that day. Or, compassionate leave is a type of emergency leave, so if someone close to you dies you can request time off that isn’t taken from your annual holiday allowance.

Check your employer’s policies regarding emergency leave before taking it unpaid, as some companies may offer paid emergency leave. There may also be alternatives to unpaid leave for carers if, for example, they will only need to leave work a couple of hours early to take their dependant to an appointment (such as working from home or making up the hours another day).

Is Parental Leave Part of Carer’s Leave?

Parental leave is another kind of unpaid leave that is not emergency leave or carer’s leave. Parents are entitled to a total of 18 weeks’ unpaid leave per child up to their 18th birthday, with a maximum of four weeks per year. This leave allowance rolls between jobs too, so if you take five weeks in one job and then change jobs, you would still have thirteen weeks left in your allowance.

Parental leave is for spending time with your child for their wellbeing. It might be to visit new schools or a new area if you are moving, spend time with visiting family who usually live far away.

Other Benefits for Carers

Taking unpaid leave for care isn’t ideal – but it does mean you still have your full annual holiday entitlement for paid leave, which you can use for more care duties or for your own self-care.

You might be able to top up your income as a carer with benefits. Carers Allowance is for those who care for someone for more than 35 hours per week. It is £81.90 per week and includes National Insurance credits – but be aware that it can affect entitlement to other benefits that you AND the person you care for get. You’ll pay tax on it too, if your income including the allowance is over the personal annual allowance (which is currently £12,750).

Carer’s Credit is for those who care for a dependant for 20 hours a week or more and tops up National Insurance credits for them.

If you’re on a low income because you can only work part-time due to your caring duties, you could be eligible for other benefits like Universal Credit and Council Tax benefit.

Knowing which benefits you could be entitled to is always confusing, as getting some might mean you’re not eligible for others. Check an online calculator like EntitledTo to make sure you’re not missing out on benefits you can claim.

The post Carers: What Leave and Benefits Can You Get? appeared first on MoneyMagpie.

Struggling with debt can be overwhelming, however, there’s help available. One option to consider is a Debt Management Plan (DMP). This is essentially an agreement between you and your creditors, making your financial situation more manageable.

Is a DMP Right for Me?

With a DMP, you’re able to:

• Make one affordable monthly payment
• Potentially stop interest and charges
• Cancel anytime

A DMP is designed to restructure your repayments into more manageable amounts, allowing you to gradually pay off your debt without the constant financial pressure.

You may want to consider this option if your debts are causing you stress, you’re struggling to pay your bills on time, or you’re frequently using overdrafts and credit cards to cover expenses.

Am I Eligible for a DMP?

To be eligible for a DMP, you typically need to meet the following criteria:

• Be a UK resident
• A minimum of £100 in disposable income each month
• Two or more unsecured debts
• A total of £2,000 or more in unsecured debt

If you’re considering this as an option, you may want to speak to a regulated debt advice firm.

The advisors at MoneyPlus Advice can review your financial situation, create a plan that suits your needs, and handle negotiations with creditors on your behalf, making your debt repayment process smoother.

Duration

The duration of your DMP can vary based on several factors, such as your monthly repayment amount and any changes in your financial situation. If your financial circumstances improve, MoneyPlus can help you adjust your repayment plan, potentially allowing you to pay your debt off sooner.

Alternatives to a DMP

If you feel a DMP isn’t right for you, there are other options you can explore.

An Individual Voluntary Arrangement (IVA) is a court-approved agreement which is designed to help you manage your debts. It allows you to pay off what you owe over a set period which is usually between five to six years. After this time, any remaining debt is written off.

If you have debts up to £30,000 (£20,000 for those in Northern Ireland), a Debt Relief Order (DRO) could relieve you from your repayments for 12 months. After this time, if you’re still unable to repay, your debts could be written off.

How to Apply for a DMP

To apply for a DMP, get in touch with MoneyPlus. They’ll assess your financial situation, including your current debts, and provide advice on the best solution for you. If a DMP is recommended, they’ll assist you through the application process, from completing paperwork to negotiating with creditors on your behalf.

Which Debts does a DMP Cover?

• Buy now, pay later
• Overdrafts
• Credit cards
• Store cards
• Payday loans
• Bank loans

Which Debts aren’t Covered in a DMP?

While a DMP can assist with many types of debt, some types of debt that aren’t included are:

• Council tax
• Income tax
• Court fines
• National insurance
• TV licence
• Utility bills
• Priority bills arrears

Living with a DMP

Once your DMP is in place, you should find it easier to manage your finances. While creditors may still attempt to contact you, you can refer them to MoneyPlus, and they’ll be able to handle the rest.

Impact on Mortgages and Renting

While a DMP may make it harder to get a mortgage or remortgage, it shouldn’t affect your current tenancy if rent payments are up to date.

Protection Against Bailiffs

While a DMP can’t guarantee protection against bailiffs, having a repayment plan in place can help keep your assets safe and reduce the risk of legal action.

Paying your DMP off Early

If your financial situation improves, allowing you to pay your DMP earlier than expected, the MoneyPlus Settlements Team can assist with this process, meaning you could settle your debts more quickly.

Why Choose MoneyPlus Advice?

MoneyPlus Advice has a rating of 4.9 out of 5 stars on Reviews.io. They have a strong track record of helping people successfully manage and overcome their debts by offering debt solution options including Debt Management Plans, Individual Voluntary Arrangements and Debt Relief Orders.

So, if you’re struggling with debt, reaching out to MoneyPlus could help you get on the path to financial stability.

Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.

The post Debt Management Plans – The Different Types and What is Best For Your Needs appeared first on MoneyMagpie.

Carers may look after people with disabilities, older people, or those with mental difficulties. They range in age from school age carers through to elderly spouses looking after their loved ones. The emotional toll of continuous care for someone you love is hard – and it often means carers forget to look after themselves mentally, physically, and financially.

If you’re a carer, make sure you’re claiming all the financial support you can. Keep reading to find out whether you’re eligible for benefits, grants, or extra help.

• Benefits for carers
• Home help for carers
• Apply for disabled adaptation grants
• Blue Badge discounts
• Carer holidays
• Emotional support for carers
• More tips

State Benefits for Carers

You could be entitled to Carer’s Allowance, if you look after someone for 35 hours a week or more.

To qualify, the person you care for must receive certain benefits, such as Personal Independence Payment (daily living component), Disability Living Allowance (mid or upper allowance), Attendance Allowance or Armed Forces Independence Allowance.

Currently, Carer’s Allowance is £76.75 week. If you’re on a low income (which is likely for many eligible carers, as 35 hours a week of care is full-time), you can apply for Universal Credit, too. This may help towards your housing costs, and entitles you to apply for a Council Tax discount, too.

You’ll get National Insurance credits for each week you claim Carer’s Allowance, or Pension Credit if you’re older.

When you’re on a low income, as most carers are, you also qualify for the Warm Home Discount scheme. This is £150 paid directly to your electricity bill during winter, to help you with the costs of heating.

Home Help for Carers

Your local authority is there to help you. As well as the state benefits available to carers, look into what your local council offers, too.

You’ll need to have a Carer’s Assessment. This is where the council assesses the level of care you provide someone else – and what you need to do that well. You could be offered respite care, support from home visits or a befriending service, and – crucially – extra financial support.

This support comes in different forms. Often, it’s designed to help you manage your caring duties more easily – such as providing equipment for the person you care for, like a bed hoist, to help you manage. Sometimes, you’ll receive a personal budget, to help with your duties. For example, if you don’t drive but regularly need to take a taxi in the line of your caring role (such as getting to and from a supermarket), a budget could be provided for this.

Carers are the unsung heroes of society. The level of financial support is very little (Carer’s Allowance is lower than weekly Jobseeker’s Allowance, for example). So, when it’s time for your Carer’s Assessment, be as honest about the impact of your caring role on your own finances. By caring for your loved one, you’ve significantly reduced the burden on the local authority’s expenditure already – so asking for financial support is perfectly acceptable!

Apply for disabled adaptation grants

OK, this one is for the person you care for, rather than you – but it’ll significantly help you, too. For example, if your loved one could turn a downstairs bathroom into a walk-in wet room, they might be able to regain some independence. This helps reduce the stress on your caring role, and gives them a sense of independent living. Even if you still need to help with bathing, it’s much easier to do this in a wet room than a typical bathroom.

Your local council will assess the needs of the person you care for and provide a budget for the work required. This is called a Disabled Facilities Grant, and is paid to the person you care for.

Get Blue Badge Discounts

The person you care for could qualify for a Blue Badge. That means that, whenever you’re driving with them, you can use the badge to park in disabled spaces or other areas so they don’t have to walk so far to their destination.

But did you know that a Blue Badge also entitles them to many other discounts? To start with, if you drive their car (when they’re with you) in London, you’re entitled to a discounted Congestion Charge fee.

You could also use their badge to prove that you’re their carer in other situations. For example, if you want to take them to the theatre, many venues offer a free Carer’s Ticket (often alongside a discounted ticket for the Blue Badge holder, too). You could even get into theme parks for free!

Again, these discounts rely on the fact you’re with the person you’re caring for – but if you can take them out and about, it’s a great way to make sure you have fun together even when you’re both on a low income.

Apply for Rail Discounts

If you travel frequently with the person you care for by train, you can apply for a discounted rail card. This gives you both one third off rail ticket prices, including peak times.

Other discounts

If you’re claiming Carer’s Allowance, and especially if you also claim Universal Credit, you’ll find there are all sorts of low-income discounts available to you.

Some colleges, for example, offer half-price courses for those who can prove a low income. You’ll also be able to claim cheaper rates at the dentist, if you don’t have any other source of income than state benefits. Many gyms, too, offer concessionary rates for those in receipt of state benefits.

If you have school age children, you can apply for additional discounts such as free school meals and discounted school uniforms. Those with children under the age of 4 could qualify for Healthy Start food vouchers, to help buy necessities such as milk. All of this will help reduce the impact of your caring role on your finances.

Find grants

There are lots of small charities out there willing to help carers fund certain things to take the financial pressure off providing care on a regular basis.
For example, if your fridge is on the blink, you could get a small grant to pay for a new one. Use the Turn2Us Grants Checker to find out which grants could help you.

Carer Holidays

You need a break every now and then! Many charities that support carers offer holidays at a discounted rate (or for free). This could be a break just for you to get away, if you can arrange care for your loved one in the interim (or sometimes they’ll provide the care, too). Or, it could be a holiday for you both to take together!

Lots of holidays for disabled people and their carers use specially-adapted accommodation to make it easy for you to get away for a few days. There’s often lots to do on these holidays, too, helping take the load off you a little.

You could also look into day services in your local area, to give you a little respite from your caring role. These services help get the person you care for out and about, socialising, and engaged in fun activities. It gives you a few hours in the week to put your feet up, have a bath, and relax – or simply get on with your own chores that have piled up!

Find carers support groups

You’re no good to helping anyone if you burn yourself out in the process! Get in touch with groups such as Care UK to find local services in your area. Many offer carer groups, allowing you to meet with other carers, and share your hopes, fears, and experiences over a cup of tea (and usually cake, too!).

Emotional support is important for your health AND your finances. That’s because when you’re on a low income, debt often looms on the horizon. If you’re stressed out and not focused on yourself, it’s easy to let small debts get out of control – with something as simple as a forgotten credit card statement.

If you don’t want to meet people in person, there are telephone lines you can try, too.

• Carers UK is available on 0808 0800 7777 Monday to Friday, 9am to 6pm. You can also email them at advice@carersuk.org for help.
• Age UK can be called on 0800 678 1602 from 8am to 7pm, every day of the year. They also have over 140 local branches you can pop into for help, too.
• Carers Direct is run by the NHS. You can use the web form to get in touch, or call 0300 123 1053 between 9am to 8pm on weekdays and 11am to 4pm at the weekend.
• Family Action offers support to parents and carers for children. Call the FamilyLine between 9am to 9pm, Monday to Friday, on 0808 802 6666. If it’s not easy to talk, text instead on 07537 404 282. You can also email them for advice at familyline@family-action.org.uk. If it’s a real crisis and out of hours, text FAMILYACTION to 85258.

Remember, you can hop on over to our Magpie Messageboards to talk to other people about your worries, experiences, and financial questions!

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Looking after yourself – and your financial wellbeing – is so important when you’re caring for someone else, too. Read these find out how to make money in your spare time, even while you’re asleep!

• How to make and sell online courses for passive income
• Earn hundreds in your spare time
• Work part-time and casual jobs
• 44 ways to make extra money
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The post Financial Help for Carers appeared first on MoneyMagpie.

It can be super confusing knowing where you are with debt terminology – being in debt can be stressful enough without having to look up loads of terms to understand their meaning.

So we’ve teamed up with Debt Advice firm, MoneyPlus, to compile an A-Z of debt terminology to help you find your footing.

A

Admin Orders: These kick in when you’ve got a County Court Judgment (CCJ) hovering over you and your total debt is under £5,000. Admin Orders let the County Court play middle man, divvying up your payments among all your creditors. While this order is in place, creditors can’t come knocking, and interest takes a breather.

Arrears: Think of arrears as the red flags waving when you miss payments on your mortgage, rent, or council tax. It’s like falling behind on a game of financial catch-up. Plus, your unpaid debts may earn you some arrears street cred with creditors.

Assets: If it’s got value, it’s an asset. We’re talking your property, car, stocks, shares, and even that vintage lamp Uncle Frank left you. These are your money-makers if you need to sell up to settle debts.

Assignment: Think of it as a handoff. One company’s selling or transferring your contract or agreement to another. Your debt’s changing hands, but your responsibility isn’t.

Attachment of Earnings: Ever heard of payday pain? That’s what happens when a court steps in to siphon off a chunk of your paycheck to repay debts. Missed a payment according to a County Court Judgment (CCJ)? Get ready for a little involuntary wage trimming.

Attachment of Benefits: When the council’s got your number, they might dip into your benefits to cover a debt you’ve been dodging. It’s like paying your dues with a small slice of your benefits pie until the debt’s a distant memory.

B

Bailiffs: These are the financial repo squad, swooping in to grab goods from your home and auction them off if you’ve got an unpaid CCJ. Consider them the final warning before your stuff hits the auction block. Find out what to do if the bailiffs are at your door.

Balloon Payment: It’s like the big finale in a firework show. You’ve been making your monthly payments, and now it’s time for one big bang – a lump-sum payment to wrap up that hire purchase or conditional sale agreement.

Bank: They’re the money masters, doling out loans like candy on Halloween. But remember, they want their umbrellas back when the financial storm hits.

Bankruptcy: Sometimes debts pile up faster than you can say “credit crunch.” That’s when bankruptcy steps in, wiping the slate clean on most debts. It’s like a financial do-over, but with some strings attached – like potentially selling off assets to square up with creditors. Find out how to go bankrupt.

Bankruptcy Order: When the court waves the bankruptcy wand and makes it official.

Bankruptcy Petition: It’s the legal paperwork that kicks off the bankruptcy process. Think of it as the first domino in your debt-releasing journey.

C

CCA 1974: The Consumer Credit Act 1974 – the law that keeps credit in check in England and Wales. It’s like the rulebook for lenders, with a few updates sprinkled in over the years.

CCA 2006: An upgrade to the Consumer Credit Act 1974, giving it a shiny new coat of financial regulation paint.

Charging Order: When a court slaps a lien on your property, making sure that when it sells, the first chunk of cash goes to pay off your debts. It’s like a debt makeover, turning an unsecured loan into a secured one.

Charge for Payment: In Scotland, this is the legal nudge telling you to pay up on an outstanding debt. It’s like a financial wake-up call, but with a legal twist.

Credit: It’s like financial goodwill – someone’s willing to loan you money based on trust and a little thing called interest.

Credit Agreement: When you and a lender shake hands (figuratively speaking) and agree on the terms of your loan. It’s like a financial contract, sealing the deal on your borrowing.

Credit Card: The plastic powerhouse of the financial world, regulated under the CCA 1974. Swipe wisely!

Creditor: The money maestro who’s got a stake in your financial game. They’re the ones lending you cash, with a little interest on the side.

CRA: The financial watchdogs keeping tabs on your credit history and payment track record.

Credit Record: Your financial report card, courtesy of Credit Reference Agencies. Find out how to clean up your credit record here.

Credit File: It’s like your financial diary, chronicling every credit move you make.

County Court Judgment (CCJ): A legal slap on the wrist for unpaid debts, courtesy of the court.

Contractual Payments: The financial promises you’ve made to keep up with your loan payments. Miss these, and you’re in hot water.

Company Voluntary Arrangement: Think of it as a financial peace treaty for businesses. With the creditors’ blessing, your business can get back on track.

Certificate Of Satisfaction: The golden ticket proving you’ve settled your CCJ or Attachment of Earnings. Just pay the £10 admission fee.

D

Data Controller: The gatekeeper of your personal data, keeping it safe and sound under the Data Protection Act 1998.

Debit Card: Your financial wingman for daily spending, with a direct line to your bank account. No credit, no problem.

Debt: The financial monkey on your back, courtesy of borrowed cash.

DCA: Debt Collection Agency, the heavy hitters tasked with chasing down your unpaid debts.

Debtor: That’s you – the one who owes the dough.

Default: The financial red flag waving when you miss a payment.

Default Notice: It’s the financial warning shot across the bow before a creditor takes action.

DMP: Debt Management Plan, your roadmap to paying off debts in bite-sized chunks.

E

Earnings Arrestment: It’s like an ATM for your paycheck, with the court skimming off a slice to pay your debts.

Equity: Your property’s financial superhero, swooping in to save the day when you’re in debt. Basically, it’s how much of your house you own.

Ex Parte: Legal proceedings flying solo, without the other party in the loop.

F

Final Discharge: The financial finish line, signaling the end of your bankruptcy journey.

Fraud: The financial fib that can land you in hot water, all for the sake of financial gain.

G

Guarantor: The financial hero who’s got your back, promising to pay up if you can’t.

Guarantee: The financial safety net that kicks in when your guarantor steps up to the plate.

H

Harassment: Crossing the financial line, defined by the Protection from Harassment Act 1997.

Hire-purchase: Your ticket to owning that shiny new gadget, with a little help from a financing plan.

Hire-purchase agreement: Your financial roadmap to owning that must-have item, regulated by the Consumer Credit Act 1974.

I

Income Payments Order: When the court comes knocking for a slice of your paycheck to pay off debts.

Informal Arrangement: Your financial handshake deal to repay creditors without a third-party mediator.

Insolvency: The financial reality check when you’re drowning in debts.

Insolvency Practitioner: Your financial lifeline when you’re in over your head in debt.

Interest: The financial fee for borrowing cash, paid in percentages.

IVA (Individual Voluntary Arrangement): Your five-year financial lifeline, offering a structured plan to pay off debts and start fresh.

J

Joint and Several Liability: When you’re on the financial hook for a loan with someone else, and they drop the ball, you’re picking up the tab.

L

Lender: The financial fairy godmother doling out loans when you’re in need.

Levy: When the bailiffs come knocking to collect what’s owed, with notice of their arrival seven days in advance.

Liabilities Orders: Your financial wake-up call for unpaid council tax, giving authorities the green light to deduct arrears from your wages or benefits.

Liquidation (Winding Up): When it’s game over for your business, and creditors are lining up to cash in their chips.

Letter Before Action or Letter of Claim: The financial head’s up before legal action comes knocking.

M

MoneyPlus: Your financial solution to help to make life less complicated – and less expensive. From financial services that can help you to overcome your troubles with debt once and for all, to jargon-free legal support so you always have someone on your side. moneyplusgroup.com

N

Notice of Assignment: When your debt changes hands, you’ll get the memo.

O

Official Receiver: The financial referee overseeing your bankruptcy proceedings.

OC: The Original Creditor.

P

Pro-Rata: Divvying up payments among creditors, so everyone gets a fair slice of the pie.

Property Restriction: When a creditor puts the brakes on selling your property during an IVA.

Proof Of Debt Form: Your financial receipt for staking a claim in an IVA or bankruptcy.

Proxy: When creditors can’t make the meeting, they send a financial stand-in to cast their vote.

R

Right To Offset: When your bank uses its financial trump card to cover missed payments on your loan or credit card.

S

Secured Debt: When your loan’s got backup, with your property or car on the line.

Secured Loan: Your financial safety net, backed by your property or car.

Statutory Demand: The financial ultimatum giving you 21 days to pay up or face the consequences.

Subject Access Request: Your financial backstage pass, giving you access to your personal data under the Data Protection Act 1998.

Surplus Income: Your financial leftovers after paying the bills, up for grabs by creditors.

T

TCC – Total Cost of Credit: Your financial bottom line, including fees and interest tacked onto your loan.

Time Orders: Your financial Hail Mary when creditors won’t budge on interest rates or payments.

Token Payments: When every penny counts, even if it’s just a token gesture toward your debts.

Transactions at an Undervalue: When your financial past comes back to haunt you, scrutinized up to 10 years back for sneaky asset transfers.

Trustee: Your financial watchdog, overseeing the sale of assets during an IVA or bankruptcy.

U

Unsecured Loan/Debt: When your loan’s flying solo, with no collateral to back it up.

V

Variation Order: When life throws you a financial curveball, and you need to shake up your payment plan.

W

Warrant of Execution: When the bailiffs come knocking to collect what’s owed, no ifs, ands, or buts.

Windfalls: Your financial silver lining, paying off debts with unexpected assets.

Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.

The post Debt Dictionary: Your Guide to Financial Jargon appeared first on MoneyMagpie.

*this article contains references to suicide

Mental health and money problems often go hand-in-hand. Research from Money and Mental Health Policy Institute reveals that in the UK, over 1.5 million people are experiencing both problem debt and mental health problems, with 86% (5,500 people) of respondents to a Money and Mental Health survey saying that their financial situation had made their mental health problems worse.

It’s also true that people with mental health problems are more likely to be in problem debt, with almost one in five (18%) people with mental health problems in problem debt. And 72% of respondents to the survey said that their mental health problems had made their financial situation worse.

As far as gender goes, women with mental health problems are 7% more likely to find it a burden to keep up with domestic bills and credit commitments, but men reported that gendered expectations, such as avoiding talking about your mental health, made it harder to access potential sources of support. Transgender and non-binary people also face obstacles to good mental and financial health, including stigma and discrimination in workplace and healthcare settings. Age and ethnic group can present compounding barriers to good income as well.

So, the overview is that juggling your financial responsibilities can often become an overwhelming task, with the problem only expounded for groups who have more barriers when it comes to accessing to help.

From credit card bills and mortgage payments to student loan repayments and utility bills, debt can start to build all too easily, causing stress and anxiety for any of us. So, the question is, what support is available to you if you’re living with mental illness that is exacerbated by financial trouble?

• Having a mental health problem can affect your income
• How debt affects mental health
• Some solutions

How does being in financial difficulty affect your mental health?

Financial difficulties are a common cause of stress and anxiety. Stigma around debt can mean that people struggle to ask for help and may become isolated. They may also think that cutting back on essentials is the only way to help them, or read something in the news about going without heat or food to cut costs: all of this is detrimental to mental and physical health.

It can become a vicious cycle where people in financial difficulty find their recovery rates for common mental health conditions drastically reduced. And something we might not know, or want to accept, is that people in problem debt are three times as likely to have thought about suicide in the past year. This doesn’t always relate directly to money but could in fact be a range of social issues, life events, cognitive and personality factors. There is an unavoidable link between problem debt and suicide, with more than 100,000 people in England attempting suicide while in problem debt annually.

Having a mental health problem can affect your income

People with anxiety and depression have a median gross annual income of £8,400 less than that of people without those conditions, and people with mental health problems are more likely to work part-time or to receive benefits, which can only provide a low level of financial support. People can struggle to attend work, maintain their benefit claims, or keep on top of managing their money.

Not to mention that a common symptom of depression is bad memory, and there is also a link with impulse buying (to get a serotonin boost to counteract feeling low), with many people reporting that their spending patterns and ability to make financial decisions change significantly during poor mental health periods.

Having a mental health problem can also affect your ability to access essential services and manage your finances – to engage with essential services such as banks and energy companies, or to understand bills and remember account details, leading to financial difficulties and distress.

All of this can drastically affect communication channels and prevent people from accessing support and addressing financial problems early.

How debt affects mental health

For many people, credit is an inescapable reality of modern life. Unfortunately, wherever there’s credit, there’s debt. This is where personal finances and mental health concerns tend to intersect.

According to a recent Money and Mental Health survey, 86% of people believe their financial situation has, at some point in their lives, made their mental health worse. This is a very worrying statistic given that, according to the charity Debt Justice, an estimated 10 million people were ‘heavily in debt’ in the UK as of April 2023.

As the cost of living continues to rise, for many, the impact of debt on mental health goes way beyond occasional feelings of stress or worry. The fact is, the constant pressure to meet financial obligations can lead to not only stress and anxiety, but also the development or exacerbation of chronic mental health conditions.

Some solutions

Support services can help people with mental health problems by identifying these people who need help and advice, but the problem remains that opportunities to spot people who would benefit from support are often missed.

Debt advice services can also serve as a lifeline to people with problem debt, but again these services are not always obvious or accessible if someone has a mental health issue.

There are legal frameworks in place in the UK designed to help those dealing with poor mental health and significant debt, not that this necessarily means debt can be written off due to mental health conditions as a rule. The Debt Respite Scheme (Breathing Space), introduced in 2021, grants temporary relief for anyone struggling with debt and interest charges by offering protection from creditor actions. For individuals with mental health conditions, Breathing Space can last for as long as they are receiving treatment (regardless of treatment length), plus a further 30 days once treatment has ended. It is worth considering if you think you fit the criteria.

Fundamental to the success of these processes is the Debt and Mental Health Evidence Form (DMHEF), however, this can only be applied for with evidence from a qualified Mental Health Professional.

Throughout this period, for many people this can be a respite or a gateway to taking the first step to regaining control over their finances and seeking professional debt management solutions such as Individual Voluntary Arrangements (IVAs), Debt Management Plans (DMPs), or Debt Relief Orders (DROs).

Total debt write-off remains rare and in the limited number of scenarios where this is an option, a complex process involving both legal and financial consultation is required. Bottom line as with all financial issues is: ask someone for help, because the first step to sorting any money problem is talking it through.

Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.

The post Debt and Mental Health – Everything You Need To Know appeared first on MoneyMagpie.

My dad once said something very simple but wise to me regarding credit card debt: “It’s as easy to pay off your credit card as it is to spend on it – it’s just a matter of habit.”

He’s right of course: we might want to treat ourselves once in a while and stick it on the old “never never” but one fine day we’ll have to pay back everything we borrow. But right there is some good wisdom: small amounts can really pile up, whether it’s from spending or saving.

So why do we all have habits when it comes to money, and what are they? As the new year is here, lots of headlines are telling us that the average debt per household in the UK is currently sitting at £65,756. This can sound a scary amount but can mean mortgages, overdrafts and even ‘buy now pay later’ (BNPL) purchases. This style of reporting instantly strikes us with debt as a negative – inferring that debt is something shameful and scary, and create a feeling around it that makes people secretive about it, makes people struggle to get help and end up in hot water.

It should be said straight up that if you need any help or advice regarding debt, then contacting the right person comes first and foremost. Hiding away from debt, understandable though the ‘ostrich’ approach is, can cause even larger issues later down the line, so picking up the phone and making that call is a step in the right direction. Whoever you speak to, make sure that first phone call is designed to aid you and offer objective help.

• Avoiding debt escalation
• Beat the BNPL Cycle
• Free debt advice charities

Avoiding debt escalation

We’ve all been there. My parents used to call it ‘the dance of the credit cards’ as you work out what money is coming out of which account, and desperately try to make sure you have enough money on the right card on the right date to ensure payments come out and don’t bounce, which can incur fees and cancellations, and bag you the dreaded red letter or CCJ through the postbox.

You can also easily get into a ‘robbing Peter to pay Paul’ situation where you’re borrowing money to pay back money you’ve already borrowed: that isn’t an endless avenue and will eventually catch up with you.

So, the best thing to do first is to Take Stock: what debts do you have and how does this stack up against your monthly income? That’s one of the first things a debt advisor will ask you: how do we limit your outgoings and find that money in your income to cover the shortfall? There’s usually a way, even if it’s by talking through your employment situation or plans, just so that the lenders know your intentions. Because believe us, it makes it way worse to hide from debt, thinking it will either go away or the people you owe money to will psychically guess what your situation is. Usually, they just want to help!

Avoiding debt won’t make it go away and an arrangement will still need to be sought with your creditors in order to overcome your debt. A debt advice company will talk you through your options and show you how this can be done: more on this in a bit.

Living Above Your Means is something we’ve probably all done at some point. That can include credit cards and BNPL deals. And trust us, if you buy now and don’t pay now, you certainly will pay later!

According to Finder.com, 38% of Brits used BNPL services in the year to January 2024, and 14% used them for the first time. In 2022 around 360 million people worldwide used BNPL services. Over half of people who used BNPL in 2023 paid a late fee (53%), an estimated 10.6 million people. That’s a LOT of us!

Now, there is “good debt” (mortgages, car loans, student loans – borrowing for investing in an asset, such as shares, that might improve your financial situation) and “bad debt” (debt that you are unable to repay. In addition, it could be a debt used to finance something that doesn’t provide a return for the investment.)

Good debt can open up an opportunity to you that you otherwise couldn’t have and can even help build a credit score.

Jonathan Mills from Debt Advice firm MoneyPlus says, “The key is responsible borrowing and transparent and honest evaluation of your financial position. Careful planning and budgeting are essential skills whether you are taking on debt or organising the repayment of debt. Debt tends to turn bad when you cannot afford repayments.”

That’s the key point: not all debt is ‘bad’ and where it tends to become so is when it’s not dealt with properly. This is how some people end up in hot water. A credit score reflects how reliable you are at repaying money, and so if you have a poor credit score, it can make it harder for you to borrow money and get good deals on things such as loans, credit cards and a mortgage.

However, a common myth is that your credit score has to be good in order for you to borrow money – this is not so. Different lenders will be looking for different things when they assess potential customers, and so while some companies may refuse you if your credit score is low, others may accept you.

Beat the BNPL Cycle

Paying later is often very tempting and there are many things we can’t or don’t want to pay for immediately. Always remember before signing up to anything loan or deb-related that, first of all, most of those deals involve interest charges, so in the end you’ll end up paying more than face value for the privilege of paying later.

Also remember that, whether it’s on a store card, credit card or other kind of borrowing deal, this money is being loaned to you and you should always read the small print carefully to make sure whatever monthly deal you’ve agreed to is something you can cover.

A third thing to consider is that, as with all debts, it’s best to take stock of what’s coming in and going out early on, and make cuts if you can: for example, do you really need subscriptions to five streaming services? Do you really need the things now you can’t afford yet, or can you go without until you’re pulling in more money? These are things a staggering amount of people neglect to consider before borrowing money.

In Conclusion…

The most important thing is to educate ourselves around our finances. Whilst the word debt can be petrifying, it is worth equipping ourselves with an understanding as to how it works.

Making sure you get the advice is key – and you should make sure that the organisation you speak to is properly regulated and can also provide advice on all the solutions out there.

It is important to say when searching for a debt advice firm that you should always check legitimacy and policy. With both the free and the paid for services, the initial phone call should always discuss what debt solutions are available and eligible to your own circumstances.

Jonathan Mills adds, “Debt isn’t always to do with not having the money and is often the result of struggling with financial planning. The free services are set up to help people in dire need and are often oversubscribed due to the sad financial climate at present.”

Free Debt Advice Charities

Finally, there are also free debt advice charities such as MoneyHelper, StepChange, Turn2us and CMA. It’s worth having a good think about your debts and who you may need help from before taking the next step (you can take a look at our ‘Fee Vs Free’ article here). Remember: nearly half of us are in the same boat.

Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.

The post Money Habits – How to Avoid the Debt Spiral appeared first on MoneyMagpie.