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Redundancy and debt

What if I am made redundant?

It is natural to worry about losing your job or being made redundant. Many people need to adjust their spending and regular payments until they find new work.

Find out what to do if you lose your job or face redundancy

Losing your job usually means having a reduced income.

You may worry about finances even if you get a redundancy payment.

This guide can help you:


  • Understand what to do next
  • Take control of your situation
  • Get your finances back on track

What is redundancy?

Redundancy is when a person loses their job because their employer wants to employ fewer people.

It is important to understand your rights if you are made redundant.

Asking for help can be hard.

Are debts causing you stress? Do you feel you never have the time?

Whatever the barrier, let’s deal with it together.

Find out more here.

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Worried about money because of redundancy?

Free, online advice and money guidance available now.

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Should I pay off my debts with my redundancy money?

We recommend only using redundancy payments to pay for essential household bills.

This is because you do not know how long it may take to find a new job.

Do not put your redundancy pay into a bank account where you owe money. The bank could take it to repay any money you owe them.

Find out more about how to pay off or reduce debts.

Should I take out more credit to pay my debts?

No, do not take out more credit if you are made redundant. This includes:


  • Getting a credit card
  • Taking out a loan or
  • Increasing your overdraft

These are short-term solutions that have a long-term impact on your finances.

Taking out credit with a reduced income is harder to pay back on time. This will likely make your financial situation worse.

Take two minutes to answer a few simple questions and find the best solution for your situation.

StepChange clients

How will redundancy affect my existing debt solution?

StepChange clients should let us know as soon as possible about job loss or redundancy.

Get in touch and we can help you find the best way to deal with your new situation.

How will redundancy affect my DMP?

We may need to adjust your monthly DMP payments if your income is reduced. There may also be other options.

Find out more about how redundancy could affect your DMP.

worried woman reading paperwork

Worried about money because of redundancy?

Free, online advice and money guidance available now.

Get help now