Universal Credit seems to be a swear word lately as more and more people are struggling to finance everyday costs when being swapped over to this “better” way of receiving benefits.
Not one person has championed this new way to receive payments and now unemployed people, those on a low income, those with disabilities and those unable to work are finding themselves without money for at least six weeks as they wait for forms to be processed.
This is leaving some homeless, as ruthless landlords won’t wait for payments, while others are using food banks as a way to survive. On top of this, many more are looking for short term loans such as pay day loans to pay bills as they endure the excruciating wait for pennies.
Pay day loans are not a good idea for anyone who is struggling to make ends meet. They’re not even a good idea for those who receive a high monthly income, yet desperate measures call for desperate actions, and there are many pay day loan companies waiting to exploit the vulnerable.
Why Do People Take Out PayDay Loans?
For those who may enjoy a comfortable lifestyle, such as Simon Cowell (who didn’t understand what a Bag for Life was on Britain’s Got Talent) it may seem nonsensical that people take out payday loans. However, for some this is the only option. When there is no money in the bank, no food on the table and a landlord threatening a section 21 due to non payment, the pay day loan seems like a beacon of hope, and a quick fix for a drastic problem.
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The Cycle Begins
However, taking out a payday loan actually catapults the borrower further into debt as they incur interest at an extortionate rate and find themselves with very little spare come payday. This begins a cycle, where every month a pay day loan is needed just to stay afloat and many are finding themselves depressed and unable to cope due to the financial stress.
The Solution to the Trap
For those without family or friends to help through the difficult times, of which there are many, there are some solutions. Please don’t despair, think twice before taking out any loan, and look at all the options available.
Those waiting on universal credit should visit the citizens advice bureaux who will give advice on bills to pay and where to find financial help as you wait for the money to be approved.
There are also other ways you can find help, such as through food banks, or groups. Seeking emotional support from people in similar situations can help. There is also free advice for those caught in the pay day loan trap at Money Nerd. You can find out how to avoid paying interest and if you need to pay the loan back at all. Contact Money Nerd with any questions you may have also.
What Can You Do to Help?
If you have no need for a pay day loan, you are one of the fortunate ones. There are ways to help. You can donate to your local foodbank, and raise awareness of how universal credit is affecting families. Some struggling families in poverty also use crowdfunding platforms to raise enough money just to eat. This decision would not have been taken lightly, so please look for any where you think you could help.
On social media, Facebook especially, there are a lot of groups for freecycling or giving items away for free. You can donate your unwanted clothes, furniture and appliances to help also.
If you have any advice for those struggling with universal credit, please leave a comment, and let our readers know how to navigate this new government system that is seeing so many families in poverty.
Tax Rebate Services
It may also be worth checking to see if you’re owed a tax refund. Visit Tax Rebate Services for all you need to know about tax, with none of the jargon.
