Millions to receive next cost-of-living payments today

Individuals will still need to do most of the heavy lifting to fortify their finances amid the cost-of-living storm.

• More than 11 million pensioners will receive regular winter fuel payments boosted by an extra £300 this year from today.
• Around a million people on tax credits can also expect to see a second cost-of-living payment arrive in their bank accounts over the next week.

Commenting, Myron Jobson, Senior Personal Finance Analyst, interactive investor, says: “Many households have been forced to cut back on spending and stretch their cash further as inflation takes hold of the economy - but the impact is felt most among those living on a bare bones budget with no room for further cuts.

“The energy and cost-of-living support payments will go a long way towards helping alleviate the inflationary crunch on budgets for the most vulnerable members of society. And further cost-of-living payments will be sent out next year to low income, vulnerable and pensioner households to help mitigate the upping of the energy price cap from April, with average bills set to rise from £2,500 to £3,000.

“Crucially, these cost-of-living support payments will be paid automatically into bank accounts for the most part – so you don’t need to do anything. It is important to be extra vigilant and wary of scams amid the roll-out of various government cost-of-living support schemes. As we saw during the pandemic, there are no depths unscrupulous individuals won’t sink to in order to swindle cash from unsuspecting victims. 

“All the cost-of-living support schemes and measures will help take the sting out of the squeeze on personal finances, but most have a shelf life. As such, it remains important to have a comprehensive understanding of your financial position and make the necessary adjustments to ensure that your financial position holds strong long after the cost-of-living measures expire. The fact remains that individuals will have to do most of the heavy lifting to fortify their finances. 

Avenues for help with living costs

“If you are struggling to pay your energy bills, contact your energy provider to ask for support. Many operate a hardship support fund offering grants to the most cash-strapped customers to help pay off their bills. Those struggling with the cost of living could also be eligible for grants from the Household Support Fund - introduced in September last year to help vulnerable households pay for essentials amid the once-in-a-generation type rise in the cost of living. 

“The fund is distributed through councils in the form of small payments. Crucially, not everyone in the UK qualifies for this benefit and the eligibility process can vary from one council to another. But is assessed on your financial ability to meet your own needs and those of your dependents.”

“It is worth consulting a debt advice charity such as StepChange or Turn2Us and they will go through all your options.”