A third of UK households have seen income reduced since lockdown started
A survey of 2,000 British adults carried out between 9 and 13 April found 33% of households now have less money coming in and one in ten are concerned about paying their mortgage or rent.
Despite emergency action by the government to help those financially hit by Covid-19, the study by comparison site GoCompare suggests only 20% of struggling households have requested or received payment holidays or an overdraft buffer.
They’ve failed to seek help because they either didn’t know they could ask or because they don’t believe banks, lenders, landlords or utility providers will help them.
According to the survey, 15% of households have experienced “a severe drop” in income, while 8% of respondents said they are having to use a credit card to pay for essentials including groceries, and 6% are borrowing money from friends and family.
Only a handful of people who have lost income as a result of the coronavirus crisis have sought help with essential bills – only 10% have spoken to their utility providers to make more affordable payment arrangements, while 12% have arranged a council tax reduction or more affordable payments.
Lee Griffin, chief executive of GoCompare, said: “If you’re struggling with your finances now or think you will soon, don’t ignore the problem in the hope it will go away. Check to see what benefits you are entitled to and find out how to access them and if you’re having difficulty in making payments or repaying loans, contact the relevant organisation as soon as possible to make more affordable arrangements.”
If you are experiencing financial difficulties, take action as soon as possible:
- Draw up a budget based on your new income and outgoings and stick to it;
- Talk to your mortgage provider or landlord as soon as possible to agree on a payment holiday or new repayment plan;
- Shop-around for a better deal for essential services and insurance such as energy, car and home insurance;
- Talk to your bank about an agreed overdraft and an interest-free overdraft buffer;
- Talk to your credit card, loan or car finance provider to see what help is available in terms of a payment holiday or a new repayment plan;
- The government has made it easier for people to access benefits and claim sick pay. Check what benefits you could be entitled to.
Find out what help is available by reading our guide to coronavirus and your finances here.