Losing your job is certainly a leading cause of debt in Scotland, and being unemployed puts you at a greater risk of getting into debt; but the current coronavirus outbreak means that even those in long term employment are suffering financially and can find it difficult to make ends meet. Let’s take a look at some of the issues that COVID-19 is causing for people around the UK who are either struggling to work from home or cannot work at all at the moment.
The problem of furlough
It’s easy for some people to assume that employees receiving 80% of their usual pay during furlough are getting a good deal since they’re not working, but for many people living this reality 80% is just not enough to pay the bills. Many people have mortgages and debts, which require repayments each month in line with expected earnings, and when these earnings are lower debts can rise. If you’re struggling to make ends meet, creditors and mortgage lenders may be able to offer extra help during this difficult time.
It’s not a good time to be self-employed
While self-employed workers who are unable to work due to coronavirus have been offered a package by the government promising 80% of wages, it comes with a lot of caveats which mean that many self-employed people are unable to access the help, including those who are newly self-employed. The legislation also measures your earnings by taking an average over the past three years, so, for example, people who have seen a recent significant increase in their earnings would not see this reflected in the amount of money they are entitled to. Other self-employed people are struggling to continue working in an economy that is now moving at a snail’s pace.
The bright side
There is one small bright side for employees who are now working from home, which is the amount of money which can be saved by not having to make the daily commute. This isn’t just the cost of travelling to and from work; it also means that most of us will be spending less throughout the week on convenience food and coffees on the go.
If you are struggling with debt or worried about your finances, Scottish Debt Help is here for you. Please don’t hesitate to give us a call on 0141 816 0394 for friendly advice and assistance.