South Manchester Credit Union (SMCU) has produced a five-step set of advice on money management as living costs continue to soar.
CEO Sheenagh Young said: “We are all experiencing a really tough and unpredictable time with everyday costs, such as heating and food bills, rising beyond our income bracket and, as we head rapidly towards the winter, it is becoming a huge source of stress for a lot of people.
“As a credit union, we are a not-for-profit, ethical financial organisation and there is a lot we can do to help people. That is why we have created this Cost of Living Emergency Plan which is there to provide support to those on lower incomes who have struggled to access credit in the past and may be stuck in a cycle they feel they can’t escape from.
“It also offers support to those on more stable incomes but who are now, due to the cost-of-living crisis, having to tighten their belts and want to make sure they maintain their financial stability through the crisis by simplifying their credit and consolidating any loans they have.”
The plan advises people to:
- Maximise your income
“You may not be able to earn more,” says the credit union, “but there may be ways you can maximise your income.”
It suggests upskilling or starting a business. “By investing a small amount in new equipment, it could create new income opportunities for you.” People should also check they are accessing all the benefits they are entitled to, through SMCU’s online benefits calculator.
- Simplify your expenses
“Take a close look at your expenses. Are you prioritising the right ones? What are your key bills? Work out what you really want to spend money on and make sure you prioritise them. We can help you do this so you’re not alone.”
- Kickstart a savings habit
“Saving is a habit that you can create and, once you do, it can become very addictive,” says SMCU. It also suggest encouraging children to save, and to work with a credit union to create a savings plan to build some financial stability for your family’s future.
- Repair your credit profile
If a member has a historic problem debt, SMCU offers to work with them one to one “and create a way forward which helps you to save first and then borrow in an affordable and structured way”.
- Take good care of your mental health
“Financial anxiety is very common, especially at a time like this,” says SMCU. “It’s very easy to feel out of control and overwhelmed but it’s really important to take care of yourself and understand that you can overcome these challenges, with a little help. ”
“Following two years of the pandemic, our communities are struggling once again,” said Young. “Many who have never experienced debt or hardship before, are facing a very uncertain winter and we can help.
“Because of the unique way that credit unions operate, we are able to lend money that people can afford to repay, as well as encouraging them to save for a more secure future.”