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From today, those struggling with serious debt can get a 60-day respite during which all interest and charges on their debt will be frozen, and they won't face enforcement action from their creditors. If someone is receiving mental health crisis treatment, they can get a longer grace period, dubbed a 'recovery space', which lasts as long as their treatment plus a further 30 days. In both scenarios you need to ask for this help though - it's not automatic.

The Government's impact assessment estimated that millions will benefit from breathing space over the next decade, with 700,000 people helped in the first year, rising to 1.2 million per year by the tenth year of operation. Between 25,000 and 50,000 of those helped each year are expected to be individuals in mental health crisis treatment.

MoneySavingExpert.com founder Martin Lewis has long campaigned for the Government to introduce breathing space for debt sufferers, to give them time to get advice and sort out their finances. In 2016, both Martin and debt help charity StepChange issued a joint statement calling for the help to be introduced.For more on where to get help, see our Debt Help guide and free Mental Health & Debt booklet.

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money and mental health policy institute

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New help for millions in debt crisis - you can now get two months' 'breathing space' from interest and enforcement action

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New rules giving those in England and Wales who are struggling with problem debt a 60-day grace period to get their finances back under control come into force today, in a huge victory for MoneySavingExpert.com and others who've campaigned hard on the issue.

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Turn2us is a national charity offering information and practical support to people facing financial insecurity. We help people gain access to welfare benefits, charitable grants and other support - online, by phone and face to face through our work in communities and the organisations we partner with.

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Credit unions are community finance organisations run by and for their members.

There are several main features of a credit union:

People who save or borrow through one must have a common bond. They might live in the same area, work for the same employer or have the same profession. They can also be members of the same church or trade union.

They're run on a 'not for profit' basis. Instead of paying a profit to shareholders, they use the money they make to reward their members and improve their services.

They can be large or small; some have thousands of members while others are much smaller.

Like bank and building society accounts, your money is protected under the Financial Services Compensation Scheme (FSCS) - up to £85,000, or £170,000 for joint accounts.

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Credit unions are community finance organisations run by and for their members. There are several main features of a credit union: People who save or borrow through one must have a common bond. They might live in the same area, work for the same employer or have the same profession.

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Find Your Credit Union - search to find credit unions near you

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Find a credit union near you. Browse 385+ credit union websites to join & apply for loans savings online. Search by home & work postcodes & associations.

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If you need emergency food, want to make a food donation or are interested in volunteering, find your nearest Trussell Trust food bank using our map.

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Dealing with money issues can sometimes be off-putting, but if you don't understand how things like credit or mortgages work, you could end up losing out financially or getting yourself deep in debt. The following pages will give you the information you need to make the right choices, including help to deal with your debt problems, how to avoid losing your home and how to get your finances back into shape.

Check what help you can get if you can't afford to pay bills like council tax and energy because of coronavirus (COVID-19). Also find out when you can get a payment holiday for bills like mortgages and tax debt.

Get help to work out how much money you owe and which debts you should pay back first.

Debt and money search

Search for articles in our debt and money section.

Use our budgeting tool or get help with your bills.

Information on choosing a qualified financial adviser, how much advice will cost, a checklist of things to think about before seeing an adviser and how to make a complaint.

Find charities and services that can help with gambling addiction.

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Dealing with money issues can sometimes be off-putting, but if you don't understand how things like credit or mortgages work, you could end up losing out financially or getting yourself deep in debt.

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Before borrowing money from anywhere, speak to your Personal Advisor who may be able to help find a different solution- such as a grant. /
Cyn benthyg arian o unrhyw le, cer i siarad â'th Gynghorydd Personol. Efallai y bydd yn gallu helpu i gael hyd i ateb gwahanol - fel grant

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Before borrowing money from anywhere, speak to your Personal Advisor who may be able to help find a different solution- such as a grant. /
Cyn benthyg arian o unrhyw le, cer i siarad â'th Gynghorydd Personol. Efallai y bydd yn gallu helpu i gael hyd i ateb gwahanol - fel grant

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Essential support for under 25s

Banks sometimes hand credit cards out like sweeties. Which is all very exciting until you're suddenly stuck with a hunking great dollop of debt, and no idea how to get out of it. Here's our simple guide to paying off credit card debt.

Which credit card should I pay off first?

If you've got multiple credit card debts, you need to work out which one's costing you the most money. Then you need to focus on blitzing that one first. Look at the interest rates on your cards - the one with the highest is the one you want getting rid of. Any extra cash you have should go towards this turkey of a debt.
However:

Always prioritise paying rent and bills over debt. Keeping warm and eating come first.

Keep paying the minimum repayments on your other cards to keep everyone happy.

Try and transfer your debt to 0% interest

Keeping your debt at an eye-watering interest rate is going to a) cost a lot, and, b) take a lot longer to pay off. It's best to transfer the money to a lower interest deal. You can do this in two ways:
1. Switch to a balance transfer credit card
These cards offer a period of time where there's no interest on your debt. This means all your payments go towards cutting down your actual debt rather than interest. However, there is a fee to transfer your debt over, usually about 3%. And you need a good credit rating to be eligible. Make sure you can pay off your debt in the interest-free period though, otherwise you'll be stung with high interest on the remaining debt.
2. Switch to a low-interest credit card
Need a bit longer to pay off your debt than a balance transfer card gives you? It may be better to switch to a low-interest credit card, which will still make it easier to pay off than your existing bill. Plus, you don't usually get charged for switching. There are loads of credit card comparison websites so try a couple to see which cards might be right for you.

Pay more than the minimum repayments

It's not fun, we know. But paying off more each month than the minimum repayment is the only way to get rid of your niggly debt. If you just stick to the minimum, you could be 30 by the time you've paid the debt off. Even if it's just a tenner or two extra, do put whatever you can towards your bill.

I'm really overwhelmed with my credit card debt - help!

If your credit card feels like such an overwhelming monster of doom, it sometimes seems easier just to hide all your bills down your trousers and pretend they don't exist. It may even seem like you'll ever get out of all this debt. But there are helpful lovely people out there who can help you feel less suffocated and sort out a repayment plan.

Good places to go for debt advice

Debt advice charities like Step Change, National Debtline, and the Debt Advice Foundation can all help you with your money worries. Give one of them a call for free, impartial advice.

Beware of dodgy debt-help companies though, and only stick with registered charities. If they ask you for any money, run away with your arms flailing.
If you need further support on this, give us a call on 0808 808 4994. We're unable to give specific money advice but can guide you to the best places for expert support.

Next Steps

The Money Advice Service offers free, unbiased and independent advice about all financial matters. 0800 138 7777

StepChange offers free advice on your debt problems, basing it round what's right for you. 0800 138 1111

Chat about this subject on our Discussion Boards.

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Welcome to The Mix, a support service for young people. There are loads of ways you can get support from us, including our articles, videos, helpline, counselling, forums, apps and more. To find which service suits your needs use the drop down menu below.

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Essential support for under 25s Banks sometimes hand credit cards out like sweeties. Which is all very exciting until you're suddenly stuck with a hunking great dollop of debt, and no idea how to get out of it. Here's our simple guide to paying off credit card debt.

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Firstly, the term 'credit card' is completely misleading as these are 'debt cards' as they allow you to borrow on them - money you need to pay back, ie, debt.

As 'credit card' is such a common term we will continue to use it here for clarity, but be aware that debt is like fire - used right it's a useful tool but used wrongly you'll get burnt.

All cards come with a credit limit, which is the maximum amount you can borrow. Lenders decide how much the limit is based on a number of factors including your income, credit score and other debt repayments. These factors also determine if you are even accepted in the first place.

If you borrow money on a credit card, you'll be charged a rate of interest, calculated as an APR (annual percentage rate). However, most cards waive interest on spending (not cash withdrawals) if you pay the money back in full by the due date on your monthly statement.

If you do choose to apply for a card, remember to use our credit card eligibility calculator first so you can check your chances of acceptance without affecting your credit score.

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Firstly, the term 'credit card' is completely misleading as these are 'debt cards' as they allow you to borrow on them - money you need to pay back, ie, debt. As 'credit card' is such a common term we will continue to use it here for clarity, but be aware that debt is like fire - used right it's a useful tool but used wrongly you'll get burnt.

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From the age of 16, we'll all have some money taken from our wages - and you'll see how much on your payslip. Your employer takes these deductions off for you, without you having to do anything. But that means what you take home (your net pay) will be less than the total you've earned (gross pay).

Sounds a little depressing doesn't it? Well, it does at first. But when you take the time to understand where your money is going, and why, you start to realise that these deductions are there to help you now - and in the future.

Payslip basics

There are three things your employer must put on your payslip:

1. Your gross pay (what you've been paid before tax and other deductions)

2. All deductions (what's been taken out)

3. Your net pay (what you'll take home after the deductions)

Now, where do these deductions go? And why are they good for your future? Let's take a closer look at the ones you might see on your payslip...

PAYE

This stands for 'Pay As You Earn' - it shows how much you're paying in income tax. This money goes towards government services, like education and the NHS.

You're allowed to earn a certain amount of money tax free before you start paying income tax. This is called your personal allowance. The example below is based on the (2019-20) with a personal allowance of £12,500 per year, check Gov.uk for the most updated figures around personal allowances and national insurance.

When you start working, you'll get a tax code that decides how much is taken from your wages. The basic rate of tax is 20% for salaries up to £37,500. So, how does this all add up?

So if you earned £24K you would take £12,500 away from that, and be left with £11,500. Therefore, you'd pay the 20% basic tax rate on £11,500.

NICs

A compulsory tax you pay if you're 16+ and earn over £166 a week. This contributes to state benefits such as the State Pension and the NHS. The amount you pay depends on how much you earn, as well as your current employment status.

Your National Insurance number (NINO) will be sent to you just before your 16th birthday. It's unique to you and makes sure there's an accurate record of how much you've paid in National Insurance contributions.

Check out the most up to date tax and national insurance thresholds. There are also plenty of online calculators which you can use to help you work out how much you will take home.

Private pension

When you're young, the last thing you're probably thinking about is your retirement. But it pays to plan ahead. Your state pension (supported by National Insurance contributions) will give you some money later in life - but you may want to put some extra money away so you're even more comfortable. And that's where a private pension comes in.

If you pay into a private pension, you'll see these deductions on your payslip. This money will stay with your pension provider until you're allowed to access it - which is usually when you're 55 or over (but they're all different).

Student loan

If you study after school, you'll probably need a student loan to help you pay for your tuition fees and/or living expenses. You can get a student loan at any age - but you'd normally get one when you start further education at 16 or 18.

Then once you earn a certain amount, you have to start paying it back - plus interest. Each month you pay back a percentage of any income over the earning threshold detailed on the repayment plan you are on. So the more you earn, the more you'll pay back. You'll be able to see what you're paying back on your payslip.

Visit the Student Finance on the government website to review the details of the different plans.

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Payslips Explained | Understanding your deductions | LifeSkills

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From the age of 16, we'll all have some money taken from our wages - and you'll see how much on your payslip. Your employer takes these deductions off for you, without you having to do anything. But that means what you take home (your net pay) will be less than the total you've earned (gross pay).

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Some benefits and tax credits are ending and being replaced by Universal Credit.

Universal Credit is a single monthly payment to help with your living costs and provides support if you are working and on a low income or are looking for work

Find out more about Universal Credit.

The following benefits and tax credits are ending and being replaced by Universal Credit:

Child Tax Credit

Working Tax Credit

Housing Benefit

Income Support

Income-based Jobseeker's Allowance (JSA)

Income-related Employment and Support Allowance (ESA)

Look out for a letter called a Universal Credit Migration Notice from the Department for Work and Pensions (DWP) explaining what you'll need to do and when. You can find out when you're likely to be asked to move to Universal Credit.

When you receive your Migration Notice letter, it's important you check the date that you will need to claim by as you won't be moved automatically. Do not worry, your letter will give you instructions to follow. Meanwhile, you can start to prepare for your move to Universal Credit.

Find out how much you're likely to get on Universal Credit.

Your current benefits will end as soon as you submit your claim for Universal Credit. You will not be able to go back to your existing benefit once you have claimed.

Find out about the support available to you and who to speak to for independent advice.

If you are in Northern Ireland, please visit NI Direct.

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Move to Universal Credit explains if you'll be moving to Universal Credit with information on when and how to apply and the support available

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Undergraduate finance | Student Finance Wales

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For students who'll be studying part-time for a Degree, Higher National Diploma (HND) or Higher National Certificate (HNC). This also includes armed forces distances learners studying full or part-time.

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Before borrowing money from anywhere, speak to your Personal Advisor who may be able to help find a different solution- such as a grant. /
Cyn benthyg arian o unrhyw le, cer i siarad â'th Gynghorydd Personol. Efallai y bydd yn gallu helpu i gael hyd i ateb gwahanol - fel grant

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Where can I go to borrow money?/ I ble galla i fynd i fenthyg arian?

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Where can I go to borrow money?/ I ble galla i fynd i fenthyg arian?

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Loan Sharks/ Benthycwyr Arian Didrwydded

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Loan Sharks/ Benthycwyr Arian Didrwydded

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The England Illegal Money Lending Team (IMLT) have launched a new smartphone app to make it quicker and easier for people to report loan sharks and access support services.

The Stop Loan Sharks app, which launched today (23 September), includes a contact form and phone number to report loan sharks, as well as information to help victims of illegal money lending to get support.

It also offers users advice on the tell-tale signs that someone is a loan shark. These include offering cash loans without any paperwork, charging extortionate interest, use of benefits or bank cards as security, and threatening behaviour or violence to get money.

The app was developed in partnership with MakoMedia and funded from cash recovered from loan sharks under the Proceeds of Crime Act (POCA).

The app also provides information to various frontline professionals who may meet loan shark victims in the course of their work: such as debt advisors, social workers and housing staff. These professionals can read information on how to recognise the signs and respond to disclosures and where to refer clients to for specialist support.

Other features include a search tool to help users find credit unions and legitimate lenders, links to confidential debt advice services and push notifications about loan shark arrests and court cases.

Users can also access case studies, experiences and real-life stories from actual victims and survivors of illegal money lending, alongside links to other media and videos.

The launch of the Stop Loan Sharks app came after the latest IMLT data revealed an increase in online reports during the first half of 2020.

Tony Quigley, Head of the Illegal Money Lending Team, said: "We are pleased to launch our new smartphone app and give victims of illegal money lending additional ways in which to access specialist practical and emotional support quickly, easily, discreetly, and safely.

"We know from research it takes on average three years for a victim to come forward for help after borrowing from a loan shark. Using technology will improve a victim's access to support services at the touch of a button and make it easier for people to report incidents and find legitimate lenders.

"This app is a valuable tool and provides excellent information for partner agencies, helping them to recognise the symptoms and effects of illegal money lending when dealing with customers. Loan sharks could be having a detrimental impact financially, physically and emotionally on their clients and service users, so it's important we work together to stamp out this callous crime and ensure victims are given the support they need."

Anyone needing support can get in touch via the Stop Loan Sharks App or by calling the 24-hour helpline on 0300 555 2222. Live Chat is available on our homepage 9am to 5pm, Monday to Friday.

The Stop Loan Sharks app is free to download on both iOS and Android devices on the App Store and Google Play Store.

Nationally, Illegal Money Lending Teams have secured more than 400 prosecutions for illegal money lending and related activity, leading to 586 years' worth of custodial sentences. They have written off £83 million worth of illegal debt and helped over 30,000 people.

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Stop Loan Sharks Reporting App Launched - Stop Loan Sharks

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The England Illegal Money Lending Team (IMLT) have launched a new smartphone app to make it quicker and easier for people to report loan sharks and access support services. The Stop Loan Sharks app, which launched today (23 September), includes a contact form and phone number to report loan sharks, as well as information to help victims of illegal money lending to get support.

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If you're thinking of having a joint credit agreement (such as a loan or mortgage) with someone else, their credit rating might affect yours.

That's because your credit file will be 'linked' to the other person's and a lender might check their file as well as your own if you apply for credit.

For example, if they fail to make repayments on credit cards or other loans, it might make your credit rating worse.

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If you're thinking of having a joint credit agreement (such as a loan or mortgage) with someone else, their credit rating might affect yours. That's because your credit file will be 'linked' to the other person's and a lender might check their file as well as your own if you apply for credit.

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Essential support for under 25s

Borrowing money has become tougher, but there are still several different ways to do it.

Overdraft

Your bank allows you to temporarily take extra money out of your current account. You are usually expected to pay this money back quickly, and the interest charges can be very expensive. The cost is even higher if you do this without asking the bank first. You could be charged stiff penalties that may add up to hundreds of pounds over a few months. Read more about overdrafts.
Pros: Quick way to borrow money Cons: Fines can be hefty if you go over your limit
Credit card/store card

This is another relatively expensive way to borrow money. You get a card to pay for goods and the card provider sends you a monthly bill; you can clear all or some of the balance, or make the minimum payment. Good for using on holiday, and many credit cards also provide short-term insurance for your purchases. Read more about credit cards.
Pros: Using credit cards sensibly is good for your credit rating Cons: It's easy to fall into the trap of only paying the minimum repayments and never clearing your debt
Unsecured loan

Useful if you need to raise a fairly large sum of money. You have to shop around for the best rates and be absolutely certain that you can afford the monthly repayments. If you don't pay up, you can be taken to court, or they might send the debt collectors around. The newer flexible loans may sound like a great idea but watch out - you could end up paying more interest. Read more about unsecured loans.
Pros: Good for borrowing large sums of money Cons: Can get scary pretty quickly if you miss repayments
Store finance/hire-purchase

A type of credit provided when you purchase a specific item. Hire purchase agreements (HP) mean that you're partly paying off a loan, and partly renting the item. They can take a very long time to pay off, and are often extremely poor value for money. You can end up paying much more than the actual purchase price. Sometimes offered on furniture or cars.
Pros: You get a cool new car, like, NOW Cons: You'll end up paying much more than it's worth in the long run
Secured loan

Your home is the 'security' for this type of loan. Although you may get a good rate of interest, if you can't keep up the payments your home can be repossessed by whomever you owe the money to. A mortgage is a common example of a secured loan, where you can end up homeless if you default on the repayments. Read more about mortgages.
Pros: Low interest rates Cons: You can lose your house!
Pay day loans

Also coined 'short term cash loans', pay day loan companies offer you wads of money on a short-term basis, often to tide you over until you're paid or your student loan comes in. The catch? They charge a huge amount of interest - sometimes over 1,500% - for the convenience. Even if you pay the loan back straight away, you'll pay back significantly more than you borrowed
Pros: It's pretty darn easy to get one Cons: The interest rates are HIGH If you need further support on this, give us a call on 0808 808 4994. We're unable to give specific money advice but can guide you to the best places for expert support.

Next Steps

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The Mix. Registered charity number: 1048995

Welcome to The Mix, a support service for young people. There are loads of ways you can get support from us, including our articles, videos, helpline, counselling, forums, apps and more. To find which service suits your needs use the drop down menu below.

Welcome to The Mix, offering essential support for under 25s.

Log in to submit your own content on our platform Your Voices.

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Welcome to The Mix, the online guide to life for young people in the UK.

Your Voices is a community-focused section of The Mix where you can share stories about your experiences on a specific issue. Upload your own videos, images, blog posts, and playlists to Your Voices and share them with your friends.

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The impact of coronavirus has put many young people at risk.
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Essential support for under 25s Borrowing money has become tougher, but there are still several different ways to do it. Your bank allows you to temporarily take extra money out of your current account. You are usually expected to pay this money back quickly, and the interest charges can be very expensive.

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A store card is a credit card you can only use with one high street chain or group.

Like a credit card, you can use a store card to buy things on credit and pay them off at the end of the month or in stages to spread the cost.

And just as with a credit card, you'll be charged interest if you don't repay in full.

The interest rate is usually even higher than for a credit card.

You might be asked if you have a store card or if you would like to have one at the till when you pay for your shopping.

They used to come with a discount on your initial purchase, but firms have agreed not to offer deals within seven days of you making a purchase, so you've got a chance to change your mind (you can cancel the card within 14 days).

If you take out a card, you might be offered vouchers or discounts - such as 10% off purchases for three months or cardholder-only reductions, or free delivery when you buy online - as incentives to encourage you to use your credit limit.

You must be at least 18 to get a store card. As with any credit card, you'll also need to undergo a credit check.

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A store card is a credit card you can only use with one high street chain or group. Like a credit card, you can use a store card to buy things on credit and pay them off at the end of the month or in stages to spread the cost.

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Essential support for under 25s

Overdrawn again? Here's the lowdown on overdrafts and how to keep on the right side of your bank.

The basics on being overdrawn

An overdraft is an agreed cash-borrowing limit arranged with your bank. It gives you a flexible way of managing your cash flow and can provide you with short-term funds if you don't have enough money, but it's not a loan.

Overdrafts can help you if, for example, you have an urgent phone bill to pay today, but the funds won't go into your account until next week. The overdraft enables you to pay off the bill, without having the actual money in your account.

How do I arrange an overdraft?

As with all forms of credit, you must be over 18 years of age before you can apply for an overdraft. You should talk to someone at your local bank branch. Some banks or building societies can arrange an overdraft through their telephone or internet banking service. However, not all bank accounts offer overdraft facilities.

It is crucial to avoid going overdrawn if you haven't arranged it with your bank, or if you are about to go over your overdraft limit. If you do not arrange to have an overdraft or an extension before the money leaves your account, you may be charged steep penalty fees as well as a much higher rate of interest. The bank could also continue to charge you extra fees every time it sends you a letter telling you you are overdrawn. The fines could add up to hundreds of pounds.

What are the benefits of an overdraft?

Overdrafts are ideal for borrowing money you know will be replaced quickly when your salary or regular funds are paid into your account.

However, it doesn't work out as good value if you are borrowing thousands of pounds in this way and never clearing your debts.

What are the disadvantages?

Some banks charge a fee for setting up an overdraft

Overdraft facilities can be withdrawn or reduced by banks or building societies at any time

If you go overdrawn before agreeing a limit with your bank you will have to pay additional high charges

If you go overdrawn above the limit agreed with your bank you will also face higher charges

If you are overdrawn and decide to transfer your bank account you must pay off your overdraft first because you are, in effect, in debt to the bank.

Free or cheap overdrafts

It's worth checking if your bank has a buffer zone that allows you to go slightly overdrawn each month without incurring the high charges usually associated with unauthorised overdrafts. There may be a small annual charge for this facility. Some banks and building societies also offer preferential terms to students, which could mean that overdrafts attract reduced interest rates or are free up to a certain amount.

Unfair charges?

If you go over your agreed overdraft limit, you may be charged a 'default charge', which can be anything from £20 to £40 for a single charge. Many people believe this is a rip-off.

However, if you are in hardship and you have outstanding overdraft charges, you can claim against your bank. See MoneySavingExpert's guide to Bank Charges for people in Hardship. The law is different in Scotland and, as a result, some Sheriff courts are allowing cases to be heard.

Paying off your overdraft

Ideally, you shouldn't live constantly in your overdraft - though it is very common. Try and reduce how much you're overdrawn by each month, so eventually you're back in the black.

Graduates! One thing to watch out for is your interest-free overdraft being reduced once you leave university. Most students enjoy a large interest-free overdraft, but the minute you graduate it can be reduced aggressively and methodically, usually by about £500 each time.

Changes to overdraft charges

From April 2020, banks can only charge for overdraft users a simple annual interest rate - without additional fees and charges.

All users of unarranged overdrafts will be better off or see no change. In most scenarios, a majority of consumers using an arranged overdraft will also see an improved outcome or no difference.

Thanks to the Citizens Advice Bureau for help with this article.

Next Steps

The Money Advice Service offers free, unbiased and independent advice about all financial matters. 0800 138 7777

Chat about this subject on our Discussion Boards.

Need help but confused where to go locally? Download our StepFinder iPhone app to find local support services quickly.

Please enable JavaScript to view the comments powered by Vanilla.

The Mix. Registered charity number: 1048995

Welcome to The Mix, a support service for young people. There are loads of ways you can get support from us, including our articles, videos, helpline, counselling, forums, apps and more. To find which service suits your needs use the drop down menu below.

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Welcome to The Mix, the online guide to life for young people in the UK.

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Essential support for under 25s Overdrawn again? Here's the lowdown on overdrafts and how to keep on the right side of your bank. An overdraft is an agreed cash-borrowing limit arranged with your bank. It gives you a flexible way of managing your cash flow and can provide you with short-term funds if you don't have enough money, but it's not a loan.

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Before borrowing money from anywhere, speak to your Personal Advisor who may be able to help find a different solution- such as a grant. /
Cyn benthyg arian o unrhyw le, cer i siarad â'th Gynghorydd Personol. Efallai y bydd yn gallu helpu i gael hyd i ateb gwahanol - fel grant

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Before borrowing money from anywhere, speak to your Personal Advisor who may be able to help find a different solution- such as a grant. /
Cyn benthyg arian o unrhyw le, cer i siarad â'th Gynghorydd Personol. Efallai y bydd yn gallu helpu i gael hyd i ateb gwahanol - fel grant

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Before borrowing money from anywhere, speak to your Personal Advisor who may be able to help find a different solution- such as a grant. /
Cyn benthyg arian o unrhyw le, cer i siarad â'th Gynghorydd Personol. Efallai y bydd yn gallu helpu i gael hyd i ateb gwahanol - fel grant

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Before borrowing money from anywhere, speak to your Personal Advisor who may be able to help find a different solution- such as a grant. /
Cyn benthyg arian o unrhyw le, cer i siarad â'th Gynghorydd Personol. Efallai y bydd yn gallu helpu i gael hyd i ateb gwahanol - fel grant

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Loan providers must allow you to pay back a personal loan in full before the end of the loan term, but it can come with an early repayment charge of typically around one to two months' interest. Any fees and how they're calculated should be set out in your loan information and agreement, so you know what to expect if you repay early.

Some lenders advertise that you won't pay an early repayment charge (ERC) or fee if you pay off your loan sooner than agreed. But it's likely that you'll still be charged up to two months interest on whatever sums you repaid early.

Under the Consumer Credit Directive, almost everyone who took out loans from February 2011 onwards can make partial or full early settlements of up to £8,000 a year before being hit with penalty fees.

If there's more than a year on the loan agreement to go, once more than £8,000 has been paid off, the maximum penalty charge that can be levied is 1% of the amount being repaid early.

If that kind of overpayment is made in the final year of the credit agreement, the penalty can't exceed 0.5%.

Ask your lender for a 'settlement statement' showing how much you'll save by repaying early.

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Loan providers must allow you to pay back a personal loan in full before the end of the loan term, but it can come with an early repayment charge of typically around one to two months' interest. Any fees and how they're calculated should be set out in your loan information and agreement, so you know what to expect if you repay early.

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What makes 'buy now pay later' popular?

The flexibility of BNPL payment options means not having to wait until you have the money in your bank account before shopping. For people looking for the best bargains and deals that are only available during a limited timeframe this can be handy. BNPL is also convenient for online clothes shoppers, as it lets you 'try before you buy'. This means you order clothes or shoes, and then if you don't want them, you can return them before the first payment is taken.

BNPL providers are popular with online retailers because they make it less likely you'll abandon your shopping basket. However, cancelling your purchase is exactly what you should do if you can't afford to buy.

Need help with buy now, pay later debt?

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Buy Now Pay Later. Payments & Debt Advice. StepChange

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The flexibility of BNPL payment options means not having to wait until you have the money in your bank account before shopping. For people looking for the best bargains and deals that are only available during a limited timeframe this can be handy.

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Hire purchase is a way of buying a car on finance, where the loan is secured against the car. You'll need to pay a deposit of around 10%, then make fixed monthly payments over an agreed time period.

This means you don't own it until the last payment has been made. So if you miss payments, you could lose the car.

Hire purchase agreements are usually arranged by the car dealer. This means they're convenient to arrange and can be very competitive for new cars, but less so for used ones.

Rates are best for new cars, so check what you'll be paying if you're buying a used car.

When you've paid half the cost of the car, you might be able to return it and not have to make any more payments - check your contract to see if this applies to you. The car will need to be in good condition too, or you might be charged for repair costs.

When you've paid a third of the total amount you owe, your lender can't repossess your vehicle without a court order.

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Hire purchase is a way of buying a car on finance, where the loan is secured against the car. You'll need to pay a deposit of around 10%, then make fixed monthly payments over an agreed time period. This means you don't own it until the last payment has been made.

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If you're paying over the odds for your overdraft, we've 10 ways to help you cut your costs. See what works for you in this Money Saving Expert guide

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MyBnk's My Moneycast - Episode 2: Debt and Borrowing

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If you're interested in taking out a loan, cutting your existing loan costs or you just want to know more about your credit score and how to boost it, we have a range of guides to help inform your decision. Our Cheap Personal Loans guide details the cheapest personal loans best buys, but also addresses whether other finance options, like credit cards, might be cheaper for you. You can also use our handy loans eligibility calculator to find which unsecured loans you're most likely to be accepted for - while protecting your credit score.

If you're looking for guidance handling debt, our debt help guide helps you take stock of your finances and points you in the right direction to get help.

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If you're interested in taking out a loan, cutting your existing loan costs or you just want to know more about your credit score and how to boost it, we have a range of guides to help inform your decision.

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A group of charities has sounded the alarm over the growing use of buy-now-pay-later to buy goods.

Citizens Advice, a network of legal, money and consumer groups, said many users were getting into debt and struggling to pay for food and bills.

Buy-now-pay-later (BNPL) is increasingly popular among young people buying online, and at some High Street outlets.

However, Citizens Advice said many consumers regretted using it.

The charity network did not want to name BNPL firms, but called for tougher regulation.

It found that 45% of 18-to-34 year olds have used the payment option in the last 12 months.

The repayment option is often advertised at online checkouts as an easy way of splitting or delaying payments on items such as clothing or electronics, with incentives such as it being "interest-free".

However, the charity network said it can be a "slippery slope into debt".

Debt quicksand

The charity network said that, overall, 27% of UK adults have used these firms in the last 12 months, rising to 37% of disabled people and 45% of people with a mental health problem.

The average person was repaying £63 a month, but CA found almost two-in-five (5.7 million) who have used BNPL in the last year didn't think it was "proper borrowing" and six million didn't fully understand what they were signing up for.

One consumer who signed up for more than she expected is Sharonjit, whose story was cited by Citizen's Advice as an example of the trouble people can get into.

Aged 32, she bought £600 worth of clothes and used a BNPL firm to pay in instalments. She didn't receive the goods and cancelled her payment to the firm while she waited for the issue to be resolved by the retailer.

She said: "The whole thing has been so stressful. I'm constantly on edge. I've just been barraged with calls, emails and letters from a debt collector - all for buying some clothes online.

"The firm said they were referring me on to someone and I had no idea it was a debt collector. I had no idea buy-now-pay-later could [hit] my credit score.

"I've never had issues shopping this way before. But this time it's like as soon as something went wrong they've washed their hands of me."

And the charity warned that four-in-10 of those who've used BNPL in the last 12 months are struggling to repay.

It found a quarter of consumers regretted paying using these platforms, with consumers frequently saying they cannot afford repayments or are spending more than they expected.

Citizens Advice said firms must overhaul their checkout processes and improve affordability checks.

Both the Financial Ombudsman Service and Financial Conduct Authority had a greater role to play in the protection of consumers and regulation of the industry, it said.

Hardship policy

Alistair Cromwell, acting chief executive of Citizens Advice, said: "Buy Now Pay Later borrowing can be like quicksand - easy to unwittingly slip into and much more difficult to get out of.

"It shouldn't be possible for people to sign up for credit without realising, and the fact this is happening so often signals that a drastic overhaul is needed.

"This industry more than trebled in 2020, and while these products work for many shoppers, the regulator has rightly recognised the potential for harm. It must ensure robust consumer protection keeps pace with changes in how we shop," Mr Cromwell said.

Several big - and smaller - names now operate in the fast-growing BNPL market, including Klarna, Clearpay, and Laybuy. PayPal launched a BNPL service last year.

However, firms stress that not all operate to the same standards.

Alex Marsh, UK head of the one of the most popular BNPL firms, Klarna, said: "There is now a variety of buy now pay later providers in the market and the findings in this report do not represent the experiences of the more than 12 million consumers who choose to use Klarna's interest free, fee-free services each year.

"We make it crystal clear for our consumers at check out that this is a credit product, we perform a credit check each time they use our service, and we are available 24/7 to support the small number of customers who unfortunately find themselves in difficulty."

Another firm, Openpay, said it had strict rules to protect consumers. Andy Harding, the firm's UK managing director of payments said: "Openpay has never run a marketing campaign specifically targeting young people and Openpay is never the default payment option at checkout - a practice that can lead to people using BNPL services unwittingly."

He added that Openpay has a financial hardship policy in place for any customers experiencing financial difficulty, including as a result of the coronavirus pandemic.

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Charities sound alarm over buy-now-pay-later debt

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A group of charities has sounded the alarm over the growing use of buy-now-pay-later to buy goods. Citizens Advice, a network of legal, money and consumer groups, said many users were getting into debt and struggling to pay for food and bills. Buy-now-pay-later (BNPL) is increasingly popular among young people buying online, and at some High Street outlets.

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Money- putting some aside/ Arian - Rhoi rhywfaint o arian heibio

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Money- putting some aside/ Arian - Rhoi rhywfaint o arian heibio

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Benefits and Entitlements/ Budd-daliadau a hawl i fudd-daliadau 

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Benefits and Entitlements/ Budd-daliadau a hawl i fudd-daliadau 

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Employment- What I need to know/ Cyflogaeth- Beth rydw i angen gwybod:

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Employment- What I need to know/ Cyflogaeth- Beth rydw i angen gwybod:

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We can run workshops for young people on any of the topic areas covered in our resources.

In the one-to-one workshops we are able to go into more depth on an issue, providing guidance based on the individual's needs.

For more information contact Bethan Wilson, Development Officer, Children in Wales. bethan.wilson@childreninwales.org.uk

Gallwn ni gynnal gweithdai i bobl ifanc ar unrhyw rai o’r meysydd pwnc sy’n cael sylw yn ein hadnoddau.

Yn y gweithdai un-i-un byddwn ni’n gallu edrych yn fanylach ar rywbeth, a rhoi arweiniad ar sail anghenion yr unigolyn.

I gael rhagor o wybodaeth, cysylltwch â Bethan Wilson, Swyddog Datblygu, Plant yng Nghymru. bethan.wilson@childreninwales.org.uk

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Gaming and Gambling/ Chwarae Gêmau a Gamblo

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Gaming and Gambling/ Chwarae Gêmau a Gamblo