The Coronavirus (COVID-19) health emergency has now become a worldwide pandemic which is affecting countries, businesses and individuals the world over. Whilst you might feel anxious about what it means for your health and wellbeing, there are things you can do now to try and financially weather yourself and your family from the economic impact.
It is only natural that during uncertain times and situations there can be snap decisions made out with your control and suddenly the plans you had in place don’t quite match up to the present circumstances. When this happens, it is a good idea to have a back-up plan which you can put into action.
Additional personal finance measures - announced 20 March 2020
- Universal Credit standard allowance increasing by £1000 for the next 12 months.
- Working Tax credit basic element to be increased by £1000 for the next 12 months.
- Suspension of the minimum income floor, meaning the self-employed can access, in full, Universal Credit at a rate equivalent to Statutory Sick Pay (SSP).
- Extra £7bn pumped into the welfare system in total.
- £1bn of support for tenants so that the local housing allowance will cover at least 30% of market rents in local areas.
Help from the government
The UK government announced on 17 March that mortgage lenders will provide three-month mortgage holidays for those that need them during the COVID-19 pandemic. UK banks have assured the government they will be flexible and understanding. For tenants, the government have drafted emergency legislation to place a complete ban on all eviction proceedings for the next three months.
In addition to this, the Scottish Government have announced £350m to help communities and individuals who are struggling in the face of coronavirus. The money will be available for those who are struggling to pay rent, or afford food or fuel.
What can I do now?
You can make plans and take control of your personal finances now.
- Draw up a monthly budget which is realistic and covers necessary and non-necessary spending. Looking through previous months’ spending patterns will help you here.
- Make an edit of your outgoings – what can you live without or aren’t using but still paying for?
- Separate out money which is already allocated to committed spend (direct debits, debt repayment, etc) from money which you have allocated to savings or leisure spend.
- Review any credit cards and their interest rates. Consider moving any debt to a 0% interest deal, but check that you will be better off after paying any transfer fees.
- Be mindful of the recent changes to overdraft interest rates. Contact you bank if you haven’t heard from them.
- If you need to prioritise payments, then make a list and contact providers to find out about any flexibility they may be offering over the next few months.
- Review any savings accounts, ISAs and additional income streams. These could bolster your financial wellbeing in an emergency.
- Keep up to date with the UK Government announcements regarding sick pay, emergency funds and other financial measures
There is more information available from government and support agencies across the UK. Help ranges from budgeting to what to do if you are made redundant.
- Step Change– finances, budgeting, employment and welfare
- Citizens Advice Scotland– finances, budgeting, employment and welfare
- Money Advice Service– finances and budgeting
- UK Government – your redundancy rights
- HM Government – find out more and apply for business support
- Scottish Government – personal debt support