The cost-of-living crisis is set to plunge 460,000 people in Scotland into debt.
A further 644,000 people are predicted to be pushed further into their existing debts.
For International Worker’s Day, we want to recognise the millions of people who are overworking to stay afloat financially.
Across the UK, over four million people are considering taking on a second job to combat the cost-of-living crisis.
Despite this, 88% of working people in the UK have experienced a burnout in the last two years and 27% said that working longer hours makes them feel depressed.
No employer in the UK can legally ask you to work more than 48 hours a week. However, those on low incomes may be struggling to afford basic living costs. Therefore, may be looking for additional employment to plug the gap in their finances.
Here at Trust Deed Scotland®, we are seeing more people than ever who have been forced to turn to credit to fund everyday essentials. We calculated that those on minimum wage are likely to be in a deficit each month after basic household funds were deducted.
Debt Help in Scotland
If you are struggling with unaffordable debt, debt help is available in Scotland.
Here at Trust Deed Scotland®, we specialise in formal Scottish debt solutions designed to reduce your overall monthly payments and get you back in control.
Our experienced advisers give debt advice tailored to you that can allow you to make an informed decision on whether a formal debt solution is right for you.
A Trust Deed
A Trust Deed is a voluntary but legally binding agreement between you and the people you owe money to, where you agree to make an affordable payment each month.
This allows you to make payments towards your debts, typically over four years, and once your Trust Deed is completed the remainder of the debt is legally written off.
Once your Trust Deed has been approved, your creditor contact will reduce, and they can no longer take any court action against you to collect the debt.
All interest and charges to your debts will also be frozen. In January 2023, borrowers in the UK paid £156 million pounds in interest a day.
To qualify for a Trust Deed, you must be living in Scotland and have debts above £5,000.
The Debt Arrangement Scheme
The Debt Arrangement Scheme (DAS) allows you to repay your debt at a manageable level for you, also freezing all interest and fees.
To qualify you can have any amount of debt but must not be in any other formal debt solution.
Like a Trust Deed, the DAS is also legally binding and the people you owe money to are not able to contact you or take any court action against you.
Payment breaks of up to six months due to unemployment or illness are also available while you are in a Debt Payment Programme (DPP).
The DAS will last until the debt is cleared but it will protect assets such as your home and cars.
Facing Redundancy
There were 90,000 redundancies in the last three months in the UK.
It can be difficult to secure another position quickly and many people may be left unemployed for extended periods of time and relying on benefits.
For those struggling to adjust to their reduced income or struggling with unaffordable debt, either the Minimal Asset Process (MAP), or a Statutory Moratorium may be the best solution.
Minimal Asset Process is a route into Sequestration, which is the Scottish form of bankruptcy. The Minimal Asset Process allows you to write off your unsecured debts in a short period of time if you are on a low income with no disposable income left after covering your essential living costs or your income is only from income dependent benefits.
A Statutory Moratorium effectively stops creditor action against you for 6 months, offering you valuable time to seek advice and think about your longer-term options. It is not a debt solution, it doesn’t write off debt and does not stop interest and charges from building up, but it does give you time to think and will stop imminent creditor action, such as a wage arrestment or a bankruptcy petition.
Regardless of your previous situation, you are not alone. In Scotland, there were 21 people a day who registered as insolvent or bankrupt between October and December 2022. Here at Trust Deed Scotland®, we will never judge you. All advice is completely confidential and seeking advice does not oblige you to follow through with a debt solution.