How can I get financial security on a zero hour contract?

Managing Money

Life on a zero hour contract often means uncertainty. Insecurity. Anxiety. When making rent isn’t a given, the possibility of not being able to make ends meet can ruin your whole month.

When your hours are reduced on a zero-hour contract

With the stress of irregular income hovering like a dark cloud, it’s no surprise that many people on zero hour contracts suffer from physical and mental health issues, as well as problems in their personal lives. Irregular work patterns – when your shifts, and number of hours, change every month – are useful in some ways. They can offer flexibility for people who want to study or raise a family. But, if minimum income isn’t guaranteed, it can also mean big problems with cash flow. Those problems can turn into issues in every part of your life.

So, what can be done about it? Financial wellness can seem beyond your grasp when you’re on a zero hour contract and earning unpredictable wages. Let’s have a look at the problems – and the possible solution.

Why is income stability important?

The best part of having a fixed monthly income is that people on them get to plan ahead. They know what they’re going to bring home next month, in a couple of months, and probably even for the next year– so they can confidently budget, plan and even save. More importantly, on a core level they don’t have to panic about the energy bill or council tax being taken on a month when they didn’t work as many hours as usual.

Money worries trickle down into every part of your life. If there’s any question about rent and bills being paid, you’re naturally going to stress about it. Anxiety and stress are terrible for your health – both physical and mental.

The chemicals produced by high stress levels can cause all sorts of problems, from weight gain to insomnia. Plus, people who already have mental health issues are even more likely to be negatively affected by financial instability. That’s why income stability is so highly valued. It’s like a safety net – things might fluctuate depending on your hours, but you don’t have to panic about not being able to make the basic payments. 

Stabilising income while working on a zero hour contract

Experts say one of the best paths to financial wellbeing is having income stability. So you know exactly how much will be coming in so you can budget and plan properly. But, of course, that’s easier said than done for people on zero hour contracts and with irregular working patterns.

Luckily, Wollit has come along with its Income Promise which makes life much easier for people on zero hours contracts and similar types of work.

Basically, we sync with your bank account and look at your average earnings. We then guarantee you a minimum income each month. That means we top you up when times are lean, and you pay us back when you’ve worked above your average hours. It’s all automatic and there’s no interest charged.

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