Walking on Thin Ice: The cost of financial insecurity [ 1.2 mb] – a new report from Citizens Advice shows that people’s finances are increasingly vulnerable to changes in income and unexpected expenses. An infographic summary [ 1.1 mb] is also available.

The decade since the financial crisis has left large numbers of households financially insecure.

Financial insecurity is driven by two things. First, people’s finances are unpredictable. More than 1 in 10 (13%) UK adults say their income changes significantly from month to month. Almost half (48%) said they experienced at least one monthly drop in income last year, with an average largest fall of £385. While the recent growth of insecure work may be making people’s incomes more volatile, to some extent unpredictable finances are inevitable – a result of unexpected expenses and major life events as well as changes at work.

Second, large numbers of people are poorly placed to manage that unpredictability – they’re not financially resilient. Household saving is at a near-record low, meaning that many people have little or no financial buffer when things go wrong. Family budgets are stretched, with nearly 1 in 10 (9%) of households spending at least 80% of their income on essentials like food, housing and fuel. Finally, household debt is rising and 2.9 million households are struggling to make payments.

Managing money in this context is hard. Many households find it difficult to respond to fluctuating budgets. This is rarely for want of trying – people with unpredictable incomes are more likely than those with stable incomes to have drawn up a budget or a spending plan.

But for families living in severe financial insecurity, managing money can feel like walking a tightrope. It means making difficult decisions about what to prioritise and what to give up. 1 in 5 (21%) people with unpredictable incomes have gone without food or essentials in the past year (compared with 8% with stable incomes).

For some, it means having to borrow to get by. Borrowing can be a lifeline for households with insecure finances. A quarter (25%) of people with volatile incomes used an overdraft to pay for essential costs like food, utilities or rent in the 12 months, compared with only 10% of people with stable incomes.

But relying on credit comes with its own risks, particularly for those who can’t predict what their next paycheck will be. With high rates of interest and expensive default charges, far from helping people to gain greater financial stability, credit products often punish people for insecurity.

There is no easy solution to financial insecurity. Three approaches would help:

  • Make sure credit products don’t push people into unmanageable debt. The FCA should build on the success of the total cost cap on payday lending by extending a similar cost cap to other types of high-cost credit.

  • Provide alternative borrowing options for those who can’t borrow affordably from commercial providers. The government should ensure that credit is available for people where the market can’t cater for them.

  • Help people build a savings buffer. The government should review how it supports non-pension saving and concentrate its resources on helping people with no savings.

Walking on Thin Ice: The cost of financial insecurity

  • April 27, 2018
  • Posted by: Rosalie Boyles

Walking on Thin Ice: The cost of financial insecurity [ 1.2 mb] – a new report from Citizens Advice shows that people’s finances are increasingly vulnerable to changes in income and unexpected expenses. An infographic summary [ 1.1 mb] is also available. The decade since the financial crisis has left large numbers of households financially…

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Sely office is on the move – important information

  • April 23, 2018
  • Posted by: Rosalie Boyles

The Selby office is currently closed due to move to new premises at 38 Ousegate, Selby, YO8 4NH. The office will reopen on Monday 30th April 2018. In the meantime if you need information or advice please telephone Adviceline 03444 111 444, (TextRelay users should call 03444 111 445). You can…

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Advice Corner – I live in a privately rented two-bedroom house and the damp in the living room is aggravating my three-year-old daughter’s asthma. I’ve told my landlord but she’s not taking action. What can I do?

  • February 20, 2018
  • Posted by: Rosalie Boyles

Resolving damp issues can be difficult – especially as the cause of the problem is not always obvious. Also, by raising any disrepair complaint to a private landlord it’s important to realise that there is a risk of retaliatory eviction. First, make sure you’re not doing anything that could be…

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Update on refurbishments at our Northallerton office

  • January 30, 2018
  • Posted by: Rosalie Boyles

We are pleased to announce that the refurbishment is on schedule and that our Northallerton office will reopen on Monday 5th February 2018. Please telephone 01748 823862 for further information or queries.

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Advice Corner – My gym will only allow me to cancel my membership in person. This is written in the contract but I’ve since moved away from the area. What can I do?

  • November 23, 2017
  • Posted by: Rosalie Boyles

To end your gym membership you will need to follow the terms of the contract. However, it’s also possible to challenge any terms which cause unnecessary hassle or are designed to keep you tied into the contract. For this reason, you could try to challenge the term which states you…

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Alternative drop-in venues during our Northallerton office refurbishment

  • November 21, 2017
  • Posted by: Rosalie Boyles

During refurbishment of our Northallerton office throughout December 2017 and January 2018 we will be running our drop-in service from the following locations: Northallerton Town Hall on Mondays 9.30 am – 12.30 pm Northallerton Library on Wednesdays 9.30 am – 12.30 pm All our other advice sessions in the Hambleton…

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Annual Report for 2016 – 2017

  • September 28, 2017
  • Posted by: Rosalie Boyles

Our Annual Report is now available to download, you can access it here In 2016 – 2017 we helped nearly 10,000 people with over 26,500 issues.  We also presented two volunteers with long service awards at our Annual General Meeting held at Richmondshire Cricket Club on Friday 22nd September 2016….

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Older veterans in North Yorkshire encouraged to access new support service

  • June 23, 2017
  • Posted by: Rosalie Boyles

A NEW SERVICE for past members of the armed forces over 65 is set to launch this weekend. Saturday marks Armed Forces Day across the UK and the new service, known as Ex-Forces Support North Yorkshire, will be present at the York and Scarborough celebrations. Veterans Tommy and Judith taking part…

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New Polish Community Outreach Service

  • June 10, 2017
  • Posted by: Rosalie Boyles

Are you Polish and concerned about issues such as employment, Brexit, discrimination, debts, benefits or housing?   Citizens Advice in Selby is here to help. Come and talk to Tom and Karolina at Selby North Children’s Centre, 2.30 pm to 4.00pm, on: Monday 26th June 2017 Monday 10th July 2017…

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Advice News – Universal Credit

  • May 26, 2017
  • Posted by: Rosalie Boyles

I am about to apply for Universal Credit for the first time, but have been told that there is a six week wait before the first payment. I’m worried that I won’t be able to pay my bills. Is this right, and is there anything I can do? After applying…

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