Lost My Job and Have No Money. Kickstart Your Personal Recovery

Mark Benson

Mark Benson

Money Savings Advice I've lost my job and have no money

If you have lost your job and have no money, it is essential that you seek the help available as soon as possible. The old benefit system is being replaced by universal credits, and it is very important to seek guidance on the new application process. You will also need to address any outstanding debts and approach your creditors.

If You’ve Lost Your Job

If you've lost your job, you should check the GOV.UK website to see what benefits you are entitled to until you find another job. StepChange can also help manage any debts you are unable to make payments towards.

In light of the 2008/9 US mortgage crisis, we saw a worldwide economic downturn resulting in large job losses across the globe. Many expect a similar outcome in early 2021 when financial support for the coronavirus pandemic finally comes to an end.

So, if you’ve lost your job and have no money, it is very important to seek advice/assistance as soon as possible.

Continue reading to get a full list of options you should consider and put into practice.

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Can I Claim Benefits After Losing My Job?

You should approach the benefits office as soon as you have been made redundant in order to begin the process of applying for benefits. The old benefit system is slowly being replaced by universal credits, although not all individual benefits have been moved onto the new system as yet.

It is therefore important that you approach your local benefits office, making them aware of your situation and act swiftly. They make schedule a face to face meeting or point you in the direction of the universal credits application page.

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How Do I Apply for Universal Credits?

Where possible, you should apply for universal credits online via the UK government website.

This is a very simple system which prompts you to answer various questions, allowing the system to mould your personal claim. If you are making a joint universal credit claim, then you can simply make individual applications then link them together.

While many online systems used by the UK government have been criticised, the universal credit process is explained in detail as you go along and structured as simply as possible.

What if I Have a Query About My Universal Credit Application?

Once you set up your universal credit account and go through the application process, you will be contacted by an administrator. They will advise you of any additional information required, processing times and will be open to answering any questions you may have.

From then on, there is a journal system where the applicant or the administrator can add questions, update the process and ultimately let you know when you can expect to receive your first payment.

How Do I Receive My Benefit Payments?

When going through the benefit application form, you will be asked to enter your bank account details. Any benefits due to you will be paid directly into your account. The system also offers a breakdown of each individual payment and how it was calculated. If there are any errors or omissions, then you should advise the administrator as soon as possible.

Can I Claim Housing Benefit?

If you’re unemployed, on a low income or claiming benefits, there is every chance that you will be eligible for housing benefit. This will likely be part of the universal credit system, but you will be able to see the breakdown for housing benefit once your payments commence.

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Is Housing Benefit Means-Tested?

If you have savings over £16,000, it is unlikely that you would be eligible for any housing benefit. There are also other situations where housing benefit will not be available such as those paying their own mortgage, living in the home of a close relative or in a situation where your partner is already claiming housing benefit for the same property.

Can I Get Help With Council Tax?

If you are unemployed, or on a low income, you can apply for a council tax rebate – you might even be eligible for an exemption. Unfortunately, you may have a problem making a claim if others live in your household as their income would be taken into account.

Can I Get Help With My Mortgage Repayments?

Obviously, if you lose your main source of income, one of your first thoughts will be whether your home is safe from repossession. Thankfully, there are potentially two different sources of assistance with mortgage repayments:-

Payment Protection Insurance

While payment protection insurance (PPI) has led to significant compensation payments for those who took out this protection without a full explanation, it can be very useful in the event of redundancy. So, the first thing to do is to check your mortgage agreement to see if there is an element of protection in the event that you are made redundant.

Support for Mortgage Interest

If you are entitled to benefits based upon your level of income, then you may well be able to claim support for mortgage interest. This is a benefit which will be paid direct to your mortgage lender to cover the interest charged on a monthly basis.

This is actually a loan which will need to be repaid at some point but can prove very helpful in maintaining part of your mortgage payments going forward. Obviously, you need to make your mortgage provider aware of the change in your situation and a potential switch to an interest-only payment in the short-term.

I Can’t Afford to Make My Unsecured Debt Repayments, What Should I Do?

If you foresee any financial difficulties in the short to medium-term, it is important to approach your lenders, making them aware of your situation. You will find that the sooner you inform them of a potential change in your income, the more appreciative and the more helpful they will be.

You may only require short-term assistance with the potential to negotiate a payment holiday or even extend the term of your existing finance.

Will I Need to Consider Bankruptcy?

There are many different options available if you are unable to make any repayments on your unsecured debts. Assuming you have no assets and no savings, you may need to consider one of the numerous debt management options.

These include debt management plans, administration orders, debt consolidation loans, debt relief orders, IVAs and potentially bankruptcy. In the majority of cases, it may be possible to give you some breathing space to try and improve your financial affairs in the short to medium-term. However, it is advisable to take professional advice when considering debt management options.


Losing your job and your main source of income can be a very traumatic time, but there is assistance out there. While historically, there has been some confusion regarding the universal credit system and the old benefit system, things are starting to become a little clearer.

The vast majority of benefits will eventually be moved to the universal credit system where one application will cover everything. It is also very important to address any form of unsecured debt such as personal loans, overdrafts, credit cards, etc and try to come to some kind of arrangement with your lenders. It may be a very trying time, but there is light at the end of the tunnel.

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Money Savings Advice Author Mark Benson

Mark Benson

Mark has been writing professionally for over ten years for the financial sector. Having started in the financial world as a stock-broker in central London and then moving to equities trader Mark is one of our senior financial writers who has a vast knowledge of multiple financial sectors.

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