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National Homeless Advice Service

Helping young people manage money and debt

Young people’s inexperience with budgeting and managing money, along with delays or difficulties in claiming benefits, may lead to debt problems, which can in turn lead to problems paying rent and bills, and to difficulty in sustaining a tenancy.

Shelter’s specialist debt advice team can advise professionals working with young people on matters relating to debt.

Shelter - specialist debt advice team



Debt as a barrier to independent living

A report from Centrepoint ‘Ready to Move On’, looking at why young people are sometimes unable to find long-term accommodation, has identified the personal debt of young people as a major barrier to their ability to live independently. The report explains the causes and impact of debt, and suggests strategies for local authorities, youth groups and other interested parties, to help deal with this growing problem.

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Life skills

Advisers and advocates for young people can assist them in accessing information and support to develop necessary life skills without which they would find it difficult to maintain tenancies and live independently. Young people may need help in the following areas:

  • claiming benefits
  • budgeting and debt management
  • accessing community resources and services
  • furnishing their accommodation
  • accessing training, education and employment opportunities
  • resolving neighbour disputes

Young people may also benefit from specific housing support, in relation to:

  • managing on a budget
  • basic home maintenance/ servicing and repairs
  • accessing decorators, plumbers, electricians etc
  • budgeting for paying bills and rent
  • applying for welfare benefits.

For more information, see Young people and tenancy sustainment.

Money Advice Service - Young People and Money Toolkit

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Local authority support

Local authorities (and commissioned partner organisations) may have in place a strategy to support young people in gaining life skills in following areas:

  • setting up a new home protocol and having agreed arrangements for support
  • agreeing with new young tenants levels of contact to mitigate against isolation
  • support to maintain tenancies when financial issues arise.

These strategies can be put in place for both private and social rented sector housing.

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Common financial problems for young people

Rent arrears

If rent arrears are caused by delays in benefit payment, the young person or their representative should contact their nearest advice centre, which can help with negotiations with the landlord. See Dealing with rent arrears and preventing eviction for more information.

Other debts

Young people should be encouraged to understand how to prioritise their debts, to deal first with rent and utilities and other debts which, if left unpaid, could result in the loss of a home through rent arrears, a gas or electricity supply being cut off or replaced with an expensive pre-payment meter or the repossession of hire-purchase goods such as a TV, washing machine or car.

Payday loans and loan sharks

Young people who are unable to easily access cheaper credit from a bank may feel they have to use a payday loan company or loan shark to deal with mounting debts.

Payday loans are a legal but expensive form of borrowing and can lead to longer-term financial difficulties. There are safer ways to borrow money and young people struggling to repay payday loans should seek advice.

Loan sharks are unlicensed moneylenders who charge very high interest rates and may use threats and violence to frighten young people who are unable to pay back their loans, perhaps pressuring them into taking more loans to clear existing ones, and so becoming trapped in a spiral of high-interest debts.

See Shelter website - Cash in a crisis for advice on how to deal with a need for financial help in an emergency.

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Benefits and financial support for young people

Young people may be able to access additional financial support to help them maintain their tenancies and live independently - for more information, see the section Benefits and financial support for young people.

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