Worrying about your finances and not knowing who or where to turn to for help can be overwhelming.
Understanding things like mortgages and rent alongside credit and borrowing is important to make sure you do not put yourself at risk financially and end up with debt.
There is plenty of support to keep you safe when managing your money and to try and prevent any risk to your home or personal belongings.
If you find that you are struggling with debt and are unable to manage repayments, it is important to think about which debts you need to deal with first. These are called priority debts.
Paying the mortgage or rent, any fuel bills, your Council Tax bill, court fines, Income Tax or VAT should take priority. There can be serious consequences to not paying these bills.
All other debts such as bank loans, overdrafts and credit cards are non-priority debts.
Contact people you owe
You must contact the people you owe money to and let them know that you are having problems as soon as possible. If you do not do this, you risk action being taken. You could even have gas or electric cut off or bailiffs can take your belongings.
The Citizens Advice Bureau (external link) or National Debtline (external link) can help and advise you confidentially and may even be able to negotiate a repayment plan on your behalf.
Managing your money
If you’re spending more than you have coming in, it's time to work out where you can help yourself to save money.
Top tips for managing your monthly income:
- Create a budget plan - it might seem overwhelming to start with, but looking at how much you have coming in, what money you have going out is a really important part of budgeting
- Write a list of everything you spend, including household bills, living costs, any insurance or interest you might have to cover, money you spend on family and friends, travel, and leisure
- If you are struggling to make your own budget planner then try to use Martin Lewis’ budgeting planning tool (external link)
- Get the whole family in your budgeting - call a meeting and sit down together to form a plan you can all stick to. Work out how much money is available and agree between you how much you will each have
- Don’t bury your head in the sand, the sooner you dace a problem the better you will feel
- Check in with your finances every day. Each day, your bank account offers a unique snapshot of where you’re at financially, and it fluctuates regularly. Checking in each day puts you in a strong position for understanding when certain bills and different pots of money will be going out, allowing you to react accordingly.
Money talks - speak to friends and family
Don’t fall into a spiral of debt.
Money can be a difficult conversation to start, but many of us will be experiencing the same issues this winter.
You can share tips, or even get support on your wellbeing by being around a strong support system.
Speak to organisations that are experts in this area
Budgeting support
There are also a number of support organisations in the borough that can offer advice on effective budgeting support, maximising income, offer savings on food and energy costs alongside other services.
Borrowing and lending
Credit unions are non-profit financial organisations owned and run by members. Membership of a credit union can help you to save and provide access to low-cost loans.
You can contact the following credit union:
Pay day lenders
Pay day lenders are companies that offer small, short term, unsecured loans and typically charge extremely high rates of interest compared to credit unions, for example.
Wigan Council discourages residents from taking out pay day loans because they can quickly get into a level of debt that is difficult to deal with. If you are considering a pay day loan, be aware of:
- An extortionate rate of interest – For every £100 you borrow you’re likely to be charged around £25 per month, which is about 1,000% APR
- Ease of rolling over the loan from one month to the next – This will massively increase the amount you have to repay
- The serious affect it can have on your ability to get credit from other lenders in the future.
Loan sharks and doorstep lenders
It is illegal to lend money without a license. Loan sharks are companies or individuals who lend money illegally, often charging very high interest rates. They often use threats, intimidation and even violence to collect their debts, leaving their victims living in fear.
The loan shark is breaking the law - you have done nothing wrong and will not be in trouble with the authorities. Debt to a loan shark cannot be legally enforced, meaning if you report it, you may not have to pay it back.
If you think you may have borrowed money from a loan shark or know about one, you can report them anonymously to the Illegal Money Lending Team.