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Being made redundant can cause lots of financial uncertainty, but there is support available and you should make sure you’re getting all the benefits you are entitled to. Essentially, there is nothing stopping you applying for these as soon as you are made redundant but you may not qualify for all of them.
It can take several weeks to process any benefits claim, which is why it’s a good idea to get the process underway as soon as possible.
The first step is to find out which benefits you may be able to claim by using an online benefits checker. Even if you think the size of your savings, including any redundancies payments you’ve received, or the income of a partner may rule you out, it is worth checking.
The government is attempting to simplify the benefits system by bringing most of them under the umbrella of Universal Credit. This includes housing benefit, income support, child tax credit and so on.
You can only apply for Universal Credit if you and your partner have less than £16,000 in savings. This includes any redundancy payments that have been made to you. If you have between £6,000 and £16,000 it will reduce your Universal Credit payments. Any savings below £6,000 will not have an impact.
It takes around five weeks from claiming Universal Credit until your first payment, so you should apply as soon as you’ve been made redundant.
If you are unable to claim Universal Credit, perhaps because your redundancy payment takes your above the savings limit, you may be able to apply for New Style Job Seekers Allowance (JSA).
Your savings and your partner’s income are not taken into account, however to claim New Style JSA you must have worked regularly as an employee for the past few years and have paid Class 1 National Insurance contributions. You must also be actively looking for work.
If you’re eligible for Universal Credit you can claim both, but payments for Universal Credit will reduce by £1 for every £1 of New Style JSA you receive.
Even if you do not need the money, it’s worth claiming New Style JSA since you’ll be awarded Class 1 National Insurance credits, which can help towards contributory benefits you may need in future such as your state pension.
If you have a health condition or disability that limits how much you can work, you may be able to claim New Style Employment and Support Allowance. Again your partner’s income and savings will not be taken into account, but you will need to have made the necessary National Insurance contributions in recent years.
There is a variety of support available during and after redundancy.
If you are being made redundant, you are entitled to take paid time off to look for another job if you have worked in your current role for more than two years.
During your redundancy and for up to 13 weeks after you can also use your local Job Centre’s Rapid Response Service, which specialises in helping those who’ve been made redundant get back into work or training. And if you’re thinking of changing careers the National Careers Service can offer help and advice.
Of course, losing your job often creates financial insecurity and stress. If you think you may struggle to keep on top of all your outgoings, talk to a debt charity before your financial situation spirals out of control. They’ll be able to give you free advice on budgeting and what your options are if you can’t afford to pay off your debts.
For those lucky enough to receive a large redundancy payment it’s worth getting some independent advice on how best to use it.
One of the largest monthly repayments that many people worry about making when they lose their jobs, is a mortgage. That’s why some decide to sell their homes and look for more affordable accommodation.
If that’s the right option for you, we can help. We specialise in buying homes quickly, in just seven days if necessary, which means your costly repayments will soon stop. Because we only buy using our own cash funds, we are never part of an unpredictable chain of housing transactions which means you can rely on the completion date we agree on.
We’re experienced at dealing sensitively with challenging home selling situations and aim to make the process as cost effective and stress free as possible. That’s why we instruct and pay for solicitors, and because we don’t use estate agents you do not have to pay their fees.
If you want to discuss how we could help you, we’d be happy to chat so please get in touch.