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Dealing with money problems during the cost-of-living crisis

  1. Dealing with money problems during the cost-of-living crisis
  2. How the cost-of-living crisis might affect your mental health
  3. What other effects might I see because of the cost-of-living crisis

Right now, you may be finding that your income isn’t going as far as it used to, due to rises in the cost of living. This can cause feelings of worry and low mood. This article explains some of the things that you can do to help your household budget.

First steps

A really helpful first step is to complete a household budget, showing your income and outgoings. Starting to write a budget can be daunting, but it’s important you do this so you can decide what steps you need to take. If you are finding the thought of completing a budget overwhelming, try and break it down into smaller steps, for example starting off by thinking about your income on one day, and moving on to your household bills the next day. You can use MoneyHelper’s free budget planner to do this, and it lets you save your budget and come back at a later date to complete it.

It’s also worth checking if there are any extra benefits you are entitled to. Navigating the benefits system can be stressful, but we have lots of information about benefits to help you. You can also use Turn2Us’s benefits calculator, which will tell you if there is anything you might be able to claim.

You might also be aware of the website Money Saving Expert, run by the finance journalist, Martin Lewis. Money Saving Expert has compiled a list of 90 ways you can beat the cost-of-living crisis which is full of useful tips on ways you can save money. These range from applying for free school meals, and seeing if you are eligible for a state pension top-up, to low-price broadband called 'social tariffs'.

The Government has announced its final cost-of-living payment in 2023/2024 financial year will be made between:

  • 6th February - 22nd February 2024: £299 for those eligible

All working-age claimants in receipt of means-tested benefits, tax credits and disability benefits will be eligible, as will pensioners entitled to a winter fuel payment. Eligible claimants will not need to claim and will be paid automatically.

You can read more about the announcement on GOV.UK.

If you have fallen into debt, take a look at our guide on dealing with debt and make sure you get free impartial advice from an organisation such as National Debtline or StepChange. Many people feel anxious or ashamed when they have fallen into debt, and that can make it harder to seek help. Our mental health and money toolkit has exercises you can complete to reduce these feelings and get you ready to start tackling your debt problems.

The ‘Help for Households’ toolkit is a cross-government campaign that raises awareness of the wide range of support available, including help with energy bills, childcare costs, transport costs, housing support, help finding work, and information about discounts and offers available for businesses to help with the cost of living.

Reducing your household bills

One way you can help your budget is to try to reduce some of your outgoings.

Water bills

Water bills are either calculated on a fixed charge, or by the water you use, using a water meter. If you are on a fixed charge, you may find your water bills go down if you switch to a water meter. This will depend on things like the size of your property and how many people live there. You cannot switch to a fixed charge if you are already on a water meter.

The Consumer Council for Water has a calculator you can use to see if your bills are likely to be cheaper on a meter. And if you’re already on a meter it can help you see how you can reduce your water usage. Some water companies have free water saving gadgets such as ones which reduce the amount of water used when you flush the toilet, which can help to lower your bills if you are on a meter.

The Consumer Council for Water website also has information about how to get help with your water bill including:

  • social tariffs, which are cheaper bills for people on low incomes,
  • flexible payments plans, and
  • grants to help you if you have fallen behind on your water bills.

Council tax

Council tax is a bill that can take up a good portion of your income each month, but there are ways to make it cheaper. For example, some people with mental illnesses may qualify for a severe mental impairment exemption and not have to pay council tax. Have a look at our page on council tax exemptions and discounts to find out more.

A lot of people pay their council tax over 10 months, with a break in payments in February and March. However, you can choose to pay your bill over 12 months. This doesn’t reduce the total amount you pay, but it can make it easier to budget, as your monthly payment is smaller. But you do need to consider that you won’t get your 2 month payment break.

The government is also giving everyone in council tax bands A-D a £150 rebate. If you pay your council tax by direct debit, and you will get this money automatically into your bank account.  But if you pay in a different way you will need to contact your council to apply. You can find their contact details by putting your postcode in this website.

Fuel bills

Fuel bills are at the centre of the cost-of-living crisis, with many people finding their fuel bills unmanageable. Although good deals are difficult to find at the moment, it is worth checking that you are on the best tariff using a site such as

You might qualify for a winter fuel payment. You can check your eligibility and how much you could get at Gov.UK. You might also qualify for the cold weather payment or warm home discount.

If you or someone in your household is vulnerable, for example, because you have a mental health problem, you can be put on the priority services register. This is a free support service to help if you are vulnerable. Support varies but can include:

  • Priority reconnection in the event of power cuts.
  • Large format or Braille bills.
  • Advanced notice of service interruptions.

You must contact your energy supplier or network operator to get on the register. Find out how to get on the Priority Services Register.

Other costs

Food can take up a large portion of your spending each month, and having a healthy diet as well as eating as much as you need is a really important part of maintaining good mental health.  Jack Monroe has a blog, Cooking on a Bootstrap with lots of healthy low-cost recipes. also has some useful tips to reduce your shopping bill

If you have a mental illness or other health problem, you may be regularly getting prescription medication. We have some information on how to get free or low-cost prescriptions.


If you need to make new purchases

Money may be tight, but there still might be things you need to buy during the cost-of-living crisis, for example furniture or appliances. Living without things that provide comfort can have a harmful impact on our mental health. End Furniture Poverty is an organisation that campaigns to make sure people do have the furniture and appliances they need. They have some useful information about what you can do if you do need these items. 


Your local community

There may be activities happening in your local community to help people through the cost-of-living crisis. Some things we have heard of happening include:

  • working parents organising swapping of childcare so others can pick up extra hours of work without extra costs,
  • sharing work and school commutes to reduce travel costs
  • organising swaps of services for goods or other services
  • local cafes offering left over food to community fridges and food banks

It’s worth checking local Facebook groups, or at the library to find out what’s happening. You might also be able to start organising these things yourself too. The added benefit of this is that you will make connections in your local community, which is good for mental wellbeing.

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  1. Dealing with money problems during the cost-of-living crisis
  2. How the cost-of-living crisis might affect your mental health
  3. What other effects might I see because of the cost-of-living crisis

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