Find yourself broke long before payday?

One in four Brits say they run out of money before payday.

A survey conducted by HR and payroll software provider, Ciphr, has revealed that 23% of Brits have found themselves ‘broke’ before they’ve been paid at least once this year. This figure includes over a quarter of employees in full- or part-time work, as well as a third of people who are unemployed and receiving benefits, and 42% of students.

It also found 30% of employees aged under 45 say they’ve struggled to pay their bills or buy food this year.

The findings follow a similar study by Citizens Advice earlier this year which revealed the number of people running out of money each month has trebled since 2020.

If you find yourself occasionally falling into the red, there’s nothing to be hugely worried about. Some months can just catch you off guard, such as a costly emergency or an unforeseen bill. And if you are caught short, remember there are plenty of places to turn for help and stop-gap support, such as:

Food banks

Food banks are there to help in an emergency. They provide food parcels containing things like tinned and dried food that should last around three days. To get help from a food bank, you will need a referral from a professional such as your GP, housing association or social worker.

Food waste apps

There are lots of apps specialising in redistributing food to help those in need. Don’t be embarrassed using a food waste app, thousands of people take advantage of the savings they offer every day. Some good ones to try include Too Good To Go, Olio and Karma – Save Food with a Tap

Household support fund

The household support fund was set up to help low-income families and those struggling with rising living costs. It can offer cash or vouchers to help with food costs and essential bills, such as heating. The fund is distributed by local authorities so what you receive will depend on how your council has chosen to use their allocation. Contact your local council for more details.

Local welfare assistance (LWA)

Local welfare assistance schemes help people on low incomes who’re facing sever financial hardship. It provides money towards food, clothing and energy bills. To find out if you qualify for help, speak to your local council.

Emergency grants

There are thousands of emergency grants available to help people in crisis. You can usually get up to £500 in cash or vouchers. Each one has its own eligibility criteria. Check out Turn2Us to find the most suitable grant for you.

Credit unions

There will be a credit union local to you. They offer a more affordable option for borrowing money for a short time, with low interest rates. They can also help with budgeting and financial advice. To get help from a credit union, you will have to become a member. Find your local credit union here.

Budgeting loans

If you claim benefits for more than six months, you’ll be able to apply for a budgeting loan. This provides quick cash in an emergency. But bear in mind that repayments will be taken out of future benefit payments, which means you’ll have to manage on less for a while.

What to avoid

Try to avoid plugging money gaps by using high interest credit such as payday loans or using illegal money lenders. Also steer clear of payroll advances and using buy now, pay later (BNPL), as borrowing from these schemes can quickly snowball if you don’t have the money to keep on top of repayments. This will only cause you more trouble in the long run. It’s better to check out help from the government, your local council and charities, before turning to high-cost solutions.

When the pot is always empty

You can usually avoid a short fall in the future through a bit of careful budgeting and money management. But if you find you’re constantly running out of money, it could be a sign you have a problem.

Debt can quickly start to build when your outgoings regularly exceed your income – i.e. what you spend is less than what you earn.

If you find yourself running out of money each month, then you should:

Check you’re claiming everything your entitled to

£23 billion went unclaimed in income related benefits last year and a further £22.7 billion worth of social tariffs wasn’t used either. Finding yourself short could be a sign that you’re not claiming everything you’re entitled to. Use our benefits calculator to see what help you qualify for here.

Get free debt help

Sometimes no matter how careful you are or how much you budget, your finances get on top of you. If you find your debts mounting and can’t see a way out, speak to us for free debt help. We will find the right solution for your individual circumstances.