Every household in the country will be poorer from the end of this week as major changes to bills, incomes and benefits take effect in early October.
Those on universal credit will see their income drop by Â£ 20 per week from the start of the month, leaving families – 5.9 million people – almost Â£ 90 per month in a worse position from the end of this month. week.
At the same time, the leave scheme that paid people who couldn’t work during the pandemic ends earlier this month.
And new fuel tariffs will come into force, pushing up gas and electricity bills with an average annual increase of Â£ 139 to Â£ 1,277.
This equates to an increase of Â£ 95 to Â£ 104 per month, reports The Mirror.
Over 4 million prepaid customers will see an even larger annual increase of Â£ 153, from Â£ 1,156 to Â£ 1,309; an increase of almost Â£ 13 per month.
This precedes the onset of winter, as people use more fuel to keep their homes warm.
Inflation means food is now 3% more expensive than at this time last year – pushing average spending from Â£ 277 per household to Â£ 285.
This means families will need an additional Â£ 107 per month to cover essential expenses this winter, according to Royal London.
Sarah Pennells, consumer credit specialist, said: âThe Covid-19 pandemic is perhaps the biggest life shock our society has ever seen.
âAs we continue to feel its effects, there has never been a more urgent need to help those who are financially vulnerable.
âStarting in October, many families will be affected by significant changes in their monthly spending and many will have less money to pay their bills due to the decline in universal credit.
âFor those who are in financial shock or are worried about making ends meet, there are steps you can take.
“For example, if you are having trouble paying your energy bills, contact your supplier as they should help you with the means to pay and don’t be afraid to seek help from a charity consultancy. matters of debt if you are having difficulty. “
How can I control my expenses?
1. Write a monthly budget
If your income has gone down, you’ll need to factor in your expenses, and one of the best ways to do that is to budget on a monthly basis.
Start by determining how much money you will need to cover your essential monthly expenses such as your rent or mortgage, utility bills, council tax, and any other debts, such as credit cards and / or personal loans.
Once you’ve done that, you should have a clearer idea of ââhow much money you need to spend on areas like your weekly store.
2. Check your entitlement to benefits
It can be complicated to determine which state benefits you are entitled to. Turn2Us has a benefit calculator to check your entitlement to means-tested benefits.
The results page will tell you what benefits and tax credits you may be entitled to and how much you may receive.
3. Shop around and change your household bills
You can save money by shopping and searching for better deals on broadband and auto and home insurance. If you’re on the energy price cap, you can already bet you’re getting the best deal because you’re protected, but it’s worth doing a quick comparison.
Normally, you could save money on energy bills by switching from the standard variable rate to a better deal. However, the volatility of energy prices means that it may be the cheapest option at the moment. It is worth checking with your provider that you are getting the best rate available.
Broadband tends to be more expensive for those who are “out of contract”, 20 million customers according to Ofcom are “out of contract” and are therefore likely to pay too much.
4. Check your eligibility using the housing tax
If you think you are unable to pay your housing tax because you now have lower income or are applying for benefits, you may be entitled to a reduction in housing tax.
What you get will depend on where you live, your situation, your household income, and whether you have children or other dependents living with you.
5. Check your subscriptions
If you have to get by on a reduced income, you should focus on covering essential costs like your mortgage or rent, utility and food bills, and reducing non-essential expenses.
It’s worth taking a quick look at your banking transactions and credit card statements over the past few months to remind yourself of all the regular payments that are made. You might be surprised to see some things that you still pay for, but no longer need or use.
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