How To Deal With Pending Utility Bills As An Unemployed?

April 9, 2024

Falling behind on utility payments is stressful. It is especially true if you have multiple liabilities with lurking payments. Certain situations like unemployment delay the payment further. In unemployment, one prioritises only critical expenses over bills. However, you cannot neglect the bills either. However, one relaxation as per Citizen’s Advice portal is “the supplier may not charge on bill older than 12 months.”

Thus, you need to pay only a year’s pending bill. However, some suppliers may charge still. Additionally, apart from principal payments, interest and penalties may overwhelm you.  Thus, paying pending utility bills is important. If dealing with a similar issue, the blog may help. It lists strategies to clear payments despite low income or unemployment.

5 Ways to Settle Pending Utility Bills without a Job

The companies may chase you for 6 years to get their dues back.  Post that, you do not need to pay utility bills. However, it may impact your credit history drastically.

If your profile reveals other debts like- payday, short-term debts or quick loans, the lender may issue a CCJ in this case, which may further impact your credit history.  It also stays on your credit report for 6-7 years even if you pay.

Thus, prioritise paying debt despite unemployment. This is because waiting until the situation improves implies high interest and penalties. It may further make it impossible to pay. Check the strategies below to pay the pending bills:

1)  Create a list of pending bill payments

List out all the utility bills including- electricity, water, subscriptions, gas subscriptions, etc. Mention every bill with the amount, interest and penalty costs. Analyse the bills with the most interest and penalties. Besides that, analyse the bills with low interest and penalties. It will help you organise your payments.

2) Prioritise bills with high-interest costs

Focus on repaying the bills with the highest interest rates and penalties. It is known as the debt avalanche method. You pay debts in order from the most expensive to the least once. Additionally, with interest accruing over time, paying these debts may help you save money.

Furthermore, credit cards amount to the highest debt. Check the best possible ways to pay for these. It impacts your credit history drastically. Most individuals struggle to pay debt at once due to CCJs.  As mentioned above, it remains on a credit report for 7 years.

Hence, individuals struggle to get quick cash facilities. Still, you may get CCJ loans from direct lenders in theUKmarketplace. However, reveal concrete repayment proof like- a salary slip. Unemployed may also qualify by revealing income from other sources like- part-time income, income from self-employed, rent, dividends, tax deductions claim, etc. It may help you consolidate high-interest debts immediately. However, apply for only the amount that you can pay for comfortably.

You can also get a guarantor to support payments against your low financial condition.  It may help you qualify for a better amount instantly and settle debts quickly.  Debt consolidation also helps you save some amount that you can utilise for survival or other payments. Additionally, shunning some debts from your credit report improves your credit score drastically. What else are you waiting for?

3)  Contact your creditors immediately

Debt consolidation may help you pay nearly half of your debts. Still, you have a lot on your plate. It may imply debts with low-interest rates. Moreover, some individuals struggle to pay all high-interest debts at once due to limited finances. Thus, re-analyse your debt payments and calculate the total pending bill costs.

Next, align it with your monthly savings from your part-time jobs. If the amount is still high, contact your creditors. Brief them about the situation again. Generally, lenders may be eager to settle the debts rather than getting nothing. Thus, they may help you with a much more affordable debt repayment plan according to your finances.  It may help you clear the debts slowly and eventually.

Additionally, if you share a great bond with your lender, he may waive off some debt percentage. Alternatively, provide some concession on interest payments. It may reduce the overall debt burden.

4)   Reduce expenses by optimising your budget

You may be living below the means as an unemployed. However, constant debt build-up requires budget reconsideration. It will help you cut expenses that do not contribute to your well-being.

It could be an additional electricity connection, unnecessary groceries, or switching to a more affordable rental space. You can also explore the government schemes that you may qualify for.The government of the country provides concessions on some utilities.

 It is for the individuals facing financial troubles. However, reveal genuine proof of the reasons that restrict you from employment. It could be a serious accident, disability or COVID-like situation. You may qualify for these schemes with genuine income proof. These schemes may help you reduce some burden on regular expenses. It means you can dedicate more towards debt repayment.

5)  Seek employment opportunities or part-time work

A low income may prove challenging to deal with multiple debts at once. Why not take steps to improve your income possibilities:

  1. Check the best freelance opportunities in expertise area. You may find quick gigs.
  2. Improve your knowledge with an additional skill-building course
  3. Check the possibilities of starting a business as an unemployed worker

These may help you create reliability for repayments to creditors. Yes, even multiple part-time jobs create the possibility for the lenders to get the money back. Save a portion of your income sources towards debt clearance. It may mean re-adjusting your budget. It leaves a little flexibility to deal with emergencies.

If you encounter an urgent cash need for a medical cause, explore external facilities. Some options like loans for people on benefits may help. You may get a loan on benefits todayfor emergencies. However, provide reliable proof of benefits income with a part-time one to prove your affordability. It is a short-term cash facility for unemployed individuals availing of government benefits.

Bottom line       

These are some most popular ways to deal with utility bills as an unemployed person. You may initially struggle with debts. However, expert guidance, reducing discretionary expenses and debt consolidation may help. These strategies help you get ahead on the credit front. It optimises your credit health and financial status.

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