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Is a flexible income leaving you struggling?

Posted 01 July 2014

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More people are becoming self-employed and many have zero hours contracts; both of which could mean a fluctuating income. This can make budgeting for outgoings challenging.

If you’re on a zero hours contract, self-employed or you rely on bonuses and overtime to top up your income, you’ll know all too well the worry that comes when you can’t be sure that your income this month will cover all of your outgoings.

However, you might be surprised to learn that’s it can be this sort of problem that leads some people to get into debt.

Irregular finances

A recent poll conducted for Debt Advisory Centre* revealed that nearly one in five UK adults work in a job where their income fluctuates each week or month. Of these, one in 10 revealed they receive overtime and bonuses that alter their income; one in 20 said they are self-employed and 4% said they’re on a zero hours or similar flexible temporary contract.

Nearly two-thirds of these respondents admitted that they have trouble making sure all of their financial commitments are covered either some or all of the time. More worryingly, 14% admitted they often have difficulties with their finances because of the nature of their income.

Widespread issue

Research released last year by the Money Advice Service** found that 8.8 million Britons are over-indebted. When we looked at the calls we receive from clients asking for help with their debts, we found that changing working hours featured in the top 10 reasons given for why people were struggling with their finances**.

There are numerous reasons why someone’s working hours might change, including being on a zero hours contract, having overtime cut or being self-employed and not getting the same amount of work each week or month. One thing all these people could have in common is the risk of being left burdened with debt.

Help is at hand

When you don’t know exactly how much your take-home pay will be each month, it could become very difficult to budget for all of your outgoings. Some people simply don’t have the peace of mind of knowing everything from their utility bills to their debt repayments will be covered by their income.

If you have debts like a credit card or loan, there may be some months you’re unable to cover your repayments if your wages fluctuate. If you find you are unable to stick to the terms of the original agreement you made with your lenders and repeatedly miss repayments, it could lead to your lenders taking action.

Whether you’re encountering difficulties with debt because of an irregular income, changes to your working hours or some other reason, it’s important to know that help is at hand. Our advisors could provide you with support and information on managing your finances, plus they could tell you about some of the debt solutions that may suit your circumstances, for which some have fees attached.

Speak to us today and let’s see how we can help you get back on top of your finances.

*OnePoll questioned a nationally representative sample of 2,000 adults aged 18 and over between 6th June and 16th June 2014, of whom 500 were Scottish residents.

**Data taken from customer calls to Debt Advisory Centre between 1st May 2013 and 30th April 2014.


by Sarah Symons

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To find out more about managing your money and getting free debt advice, visit Money Advice Service, an independent service set up to help people manage their money.