Personal finance and debt experts have explained exactly what steps you need to take
A personal finance expert has shared her advice for households which may be impacted by the government’s proposed welfare reforms. While the government has softened some of its proposed welfare reforms, new claimants of sickness-related benefits remain at risk of receiving less support at a time when many are already struggling.
According to the latest data from the ONS, nearly half (47%) of disabled people say they are finding it difficult to afford their energy bills, housing costs or other essentials, compared to just 29% of non-disabled people. The shift comes as part of the Universal Credit and Personal Independence Bill introduced in March, which aims to reduce spending and reshape support in response to changing demographics and rising welfare costs, expected to hit £70 billion a year by the end of the current parliament.
Maxine McCreadie, a personal finance expert at UK Debt Expert, said: “When support is reduced, it’s not just numbers on a page, it’s people making impossible choices between heating, eating, or paying the rent. For those already living with long-term health conditions or disabilities, even a small cut to their income can have a huge impact.”
Although the most significant changes to Personal Independence Payments (PIP) won’t take effect until 2026, the government’s plans have already sparked anxiety among those living with long-term health conditions. Currently, one in ten working-age people in the UK claims a sickness or disability benefit.
If you think you might be impacted, or you’re already worried about making ends meet, Maxine has shared five practical ways you could protect your finances:
Understand what’s changing“Universal Credit is complex, and changes to sickness-related elements won’t impact everyone in the same way. At the moment, the cut is due to affect new claimants, but it’s still wise to check how this might apply to you, especially if your health situation or eligibility status is likely to change.
“Don’t rely on social media hearsay or second-hand advice. Your local council welfare team can provide free, up-to-date guidance specific to your circumstances.”
Review your budget now“If there’s a chance your income might drop, acting early can help you avoid panic later. Start by listing all your regular outgoings, from rent or mortgage payments and energy bills, to subscriptions, groceries and transport. Are there non-essentials you can pause or downgrade temporarily?”
“Small changes, like switching supermarkets or cancelling unused services, can create more breathing room. This doesn’t have to be permanent, but it’s about building a buffer and giving yourself more control.”
Prioritise your payments“When money is tight, not all bills are equal. Some payments carry more serious consequences if you fall behind – like your rent, mortgage, council tax, or energy bills. These are called ‘priority debts’ and should always be dealt with first.
“If you’re struggling to pay, contact your provider or landlord early, they may be able to set up a payment plan or offer breathing space. Don’t ignore warning letters, even if they feel overwhelming, facing things head-on is always better than letting debt escalate.”
Check for other support“Even if your main benefit is reduced, you might qualify for other forms of help. Local authorities often offer discretionary housing payments, council tax support or crisis funds, and there may be additional grants available depending on your circumstances, such as disability-related costs or carer responsibilities.
“Use benefit calculators to make sure you’re not missing anything. You can also contact your local authority or a welfare rights adviser to help you navigate what’s available.”
Get debt advice early“If you’re using credit to cover essentials, or just feeling anxious about how you’ll cope, it’s never too early to get help. Free debt advice services can help you understand your options and create a plan.
“They’ll never judge, and they’re there to help you get back on your feet – whether that means budgeting support, negotiating with creditors, or looking at debt solutions if needed.”
Maxine adds: “The good news is that help is out there. Acting early, before things reach crisis point, gives you the best chance of staying afloat. Whether it’s checking what you’re entitled to, reshuffling your budget, or speaking to a free debt adviser, there are practical steps you can take today that might just stop tomorrow from feeling unmanageable.”