With the month of May highlighting International Worker’s Day, we deep dive into how you can manage debt and take control of your finances while working full-time
What is International Workers’ Day?
Traditionally celebrated on 1st May, International Workers’ Day is dedicated to workplace rights. Also known as May Day or Labour Day, the date was chosen to commemorate an 1886 strike when 400,000 workers in the USA walked out of their jobs to demand an eight-hour working day.
Today’s International Worker’s Day provides an opportunity to highlight the importance of workers while also recognising the continued need for fair pay, workers’ rights, and improved working conditions.
Working full-time and in debt
A common misconception around debt is that people only fall behind with their bills when they’re not working. In fact, many people who work still struggle with their finances. If you work full-time and still have problem debt, you’re not alone.
In April 2024, the StepChange Det Charity released data that shows one in five (21%) of their clients who are in full-time work also have a negative budget. This means their expenditure exceeds their monthly income. It’s estimated that almost three million employed people are experiencing problem debt in the UK and 44% of those seeking debt advice from StepChange in December 2023 were in full-time work.
The cost-of-living crisis and rising rents has led to many workers facing financial difficulties for the first time. In the UK, the average annual salary pre-tax is £28,000, which isn’t stretching as far as it once did, leaving people relying on credit to cope. Citizens Advice report that a third of all households they support who are unable to cover their benefit expenses have at least one person in work.
How to deal with debt when in full-time work
So, what can you do if you’re working full-time yet still finding it impossible to get on top of your debts?
Speak to your employer
Being honest with your employer about your financial situation can be difficult. Some workplaces aren’t very supportive, and you might not feel safe sharing personal information. However, if you’re concerned your money worries are impacting your work, approaching your employer could unlock access to a range of resources that you wouldn’t otherwise be able to use.
Speaking openly about your debt at work can also help other team members be more empathetic when dealing with you. This could make them more understanding if you need to take time off to handle your debts or if your work performance temporarily dips while you’re getting back on track.
Many workplaces also offer free resources such as an Employee Assistance Programme (EAP), money management training and workshops, flexible working policies, and additional days off.
Increase your income
While you should always prioritise your mental and physical health, if you can find ways to increase your income, you might be able to clear your debt faster. As a full-time worker, you might be able to push for a promotion or pay rise at your current job or look to switch to a new role with a higher salary elsewhere.
If neither of these options are available, you could look at taking on a second job. Sacrificing your Saturdays to work an extra job until your debt is paid off might be a compromise worth making in the short-term. You could also look to market your skills as a freelancer to pick up projects that can fit around your current job in evenings and weekends.
Seek debt advice
Whether you’re experiencing financial difficulty for the first time, or you’ve been struggling with your debts for a while, seeking debt advice could make all the difference. An expert debt adviser is an unjudgmental source of support. They’ll take the time to understand your situation, investigate the different debt management solutions on your behalf, and help you handle all the paperwork to get started with an Individual Voluntary Arrangement (IVA) or Debt Management Plan (DMP) while you’re at work.
Once you’ve started working with a debt expert, they can talk you through all the options available and support you with things like setting up a manageable budget and entering Breathing Space, if that’s the best choice for you.
Check your benefit eligibility
Even though 9% of StepChange’s fully employed clients are eligible to receive Universal Credit payments and still struggling to make ends meet, it’s worth exploring whether you’re eligible for government support. If you work full-time, you might not think you qualify for any benefits but there are several different funds available to support people who are working but have a low income.
You may be eligible for Universal Credit if you’re over 18 and under State Pension age and have less than £16,000 in savings or other investments. Working tax credit is also available for people on low incomes who work at least 30 hours a week (if you’re aged 25 to 59), which could give you up to £1,015 a year. If you’re a parent, you may be eligible for Child Tax Credit of up to £3,455 for each child.
Navigating debt while in work? Our team of experts is here to help. Give us a call on 0161 8260 585 or send a message here
