Martin Lewis advises ‘best’ bill struggling Britons should pay less of first
The financial journalist often offers handy tips and tricks to saving money throughout the year, however, has been providing helpful advice during the coronavirus pandemic. The closure of many businesses as a result of COVID-19 has affected people across the country financially. However, the Coronavirus Job Retention Scheme has proved a saving grace, as the government is to pay 80 percent of salaries up to £2,500.
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Despite this, Britons are dealing with a reduction in their usual income and are searching for ways to cut costs.
Taking to social media, Martin has been providing the answers to a wide range of questions asked by Britons looking to make savings.
And one social media user, Rachel, highlighted a question that rings true for many people on furlough.
They wrote: “Martin, as I’m being paid 80 percent is is best to take payment holidays or try to meet all bills?”
Martin responded with important bill advice which could help many people in a similar situation.
He tweeted: “Interesting question. Meet bills if you can.
“If you have to take a payment holiday, mortgage is the best one to take as knock on costs are relatively less.
“Avoid credit card, car finance, loan or other unsecured debt holidays unless an emergency.”
Mortgage payment holidays are currently being offered by many providers after advice issued by the Financial Conduct Authority (FCA).
Many borrowers could take a break from paying their mortgage to save money during desperate financial straits.
However, Martin has advised against credit card loans for a reason he went on to explain.
The financial journalist responded to another question on why to avoid credit card payment holidays.
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He said: “Because the interest is high and that carries on racking up – if it were a zero percent card I’d be less bothered.”
The FCA has recently brought in help for loan and credit card customers in a similar way to mortgage holidays.
Up to three months in payment holidays are available to those who are financially affected by the COVID-19 outbreak.
Britons will not usually have to prove they have been financially struggling, but should think carefully about taking out a payment holiday.
This is because interest will still be charged during the payment holiday, and one could end up paying slightly more overall.
In a recent post on his MoneySavingExpert website, Martin reminded Britons they have until July 14, 2020 to request a payment holiday.
This holiday will last for up to three months from the date it is granted by the company.
Several lenders including Barclays, HSBC, Halifax, Lloyds and NatWest are offering the payment holidays for loans.
And companies such as Co-op Bank, Nationwide, Santander and TSB are offering similar support for credit card customers.
Martin also advises those who are struggling to meet debt repayments to approach a non-profit debt counselling help service to provide further advice.
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