10 Tips to help your finances survive coronavirus

Harvey Jones

Coronavirus isn’t just a health crisis, it is plunging millions of Britons into financial difficulties as well. If you’re struggling to make ends meet during the Covid-19 lockdown, it's time to give your personal finances a thorough overhaul

Draw up a budget

Start by listing all your monthly outgoings, and cutting out any unnecessary spending, such as direct debits or services you no longer use.  

Then hit the comparison sites to see if you can find a cheaper energy supplier, and cut premiums on your motor, household, and pet insurance policies. 

 

Build up your rainy-day fund 

One benefit of going into lockdown is that we are spending less on petrol, trains meals out, trips to the cinema and holidays.  

Put the money you save to work by building an emergency pot of money, to help tide you through this crisis and any future financial setbacks. 

 

Get a cheaper mortgage 

While the property market has come to a halt, existing homeowners could take advantage of recent interest rate cuts by remortgaging to a cheaper home loan. 

You could save hundreds, or even thousands, of pounds a year. 

 

Handle overdrafts carefully 

The Financial Conduct Authority has forced banks to grant struggling customers interest-free overdrafts up to £500, for three months from 9 April.  

While this could give you valuable breathing space the money still needs to be repaid, and extra borrowings could prove a burden when you start paying interest of up to 40 per cent again. 

 

Beware credit card debt 

Most banks are also increasing credit card limits, waiving penalties for missed payments, and offering payment holiday. The FCA has barred providers from cancelling cards owned by customers with persistent debt problems, until October.  

Use plastic with caution, though, because those 20% APRs will kick in later. Consider switching existing debt to an interest-free balance transfer card. 

 

Check what help your bank offers. 

Bank phone lines are inundated right now, but most have set out their coronaviruses policies on their websites.  

Spare yourself a frustrating wait on hold, by checking there first. 

 

Get in touch 

If you are having trouble paying everyday bills, whether gas and electricity, water, or a car leasing agreement, do not simply stop payments as that will damage your credit rating.  

Explain your problems to your provider, to see what help they offer at the moment. 

 

Keep paying insurance 

Money is tight but if possible, you should continue to pay for valuable cover such as home insurance, life insurance, critical illness cover, and income protection, to keep your family protected. 

 

Claim state benefits 

You have lost your income, state benefits may partially plug the gap.  

The government has removed some barriers for people applying for Universal Credit, and boosted payments. Check your eligibility at Turn2Us.org.uk or StepChange.org

 

Seek debt help 

If running into serious financial difficulties, seek free advice from debt charities including Citizens Advice, StepChange Debt Charity and National Debtline, while avoiding those who charge a fee. 

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