A concerning new report has indicated that nearly five million tenants in Britain have no contingency plan to cover their rent if they become too poorly to work for three months or more.
This alarming figure comes despite the fact that 27% of renters in paid employment said they knew someone who was struggling to keep up with payments.
Survival
34% of renters in paid employment admitted to not knowing how long they could continue paying rent for, should they fall ill. 60% said they could only survive on their savings for three months or less.
53% said that they would apply for benefits should they fall ill. 47% said that they would cut their household expenses and 39% said they would utilise their savings.
However, just 7% of tenants currently in paid employment said they had conducted a financial adviser, with most people turning to friends and family for help.
5m tenants have no plan to cover rent if they fall ill
Reality
Head of Protection for Royal London Intermediary, Debbie Kennedy, said, ‘renters who assume that housing benefit will be there when they need it could find the reality is very different. A series of cuts to housing benefit means that more people would not get their rent paid in full if their income fell unexpectedly.’[1]
‘It would be bad enough to be taken ill without the added anxiety of getting behind with the rent and facing possible eviction. Income protection may be more affordable than people realise and can provide a financial safety net and enable people to focus on getting better,’ Kennedy added.[1]
Over the next ten years, economists predict that the UK will experience slower levels of homeownership and increased levels of private renting. It is predicted that in ten years’ time, 59% of 20-39 year olds will privately rent, up from 45% in 2013.
[1] http://www.propertyreporter.co.uk/landlords/5m-renters-at-risk-warns-royal-london.html