Pay cuts ahead?

Many workers – including people already in debt – could be worse off next year if companies cut their pay in an attempt to reduce costs without losing staff.

As The Times reports, major employers such as JCB have already agreed on pay cuts, and cuts ‘could begin in earnest next month when traditionally a large number of pay negotiations are held’.

“Companies everywhere are struggling to cope with the effects of the economic downturn,” said a debt management expert for Gregory Pennington, “and pay cuts are often regarded as one way of avoiding – or at least moderating – the need to make workers redundant.

“Whatever the reason, a significant pay cut can have a serious impact on a household’s finances.

“In many households, virtually every penny of income is already taken up paying bills, servicing debts and coping with other essential expenses, so any reduction can be painful. However, there are debt solutions, such as debt management, that may be able to help borrowers bring their income and expenditure back into line.”

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Gregory Pennington offer debt management plans as part of a range of debt solutions. If you are worried about your debts, contact one of our expert debt advisers now.