Second jobs needed to avoid Scottish trust deeds?

20th June 2011

In the current economic phase many households around Scotland are experiencing unprecedented pressures on their household finances. Taxes and the cost of essentials have increased whilst wages are failing to keep pace. Many households are also burdened with a certain amount of unsecured debt, the cost of which has also been on the rise. These ingredients produce a perfect recipe for a debt spiral and the eventual requirement of Scottish trust deeds.

One answer to such a problem is for individuals to increase their income by taking on a second job. A national newspaper recently investigated the extent of this phenomenon and found that 100,000 people throughout the UK had taken on a second job during the last twelve months. The total number working more than one job is now in excess of a million.

Professionals offering Scottish trust deeds advice follow a process of looking to maximise available income whilst minimising costs prior to formally signing into trust deeds. Trust deeds should only be treated as a last resort. For some taking a second job should be sufficient to raise enough extra income to negate the need for Scottish trust deeds.

For some individuals their level of debt has reached a critical point at which it is impossible to earn enough extra income to make debts payments affordable. Many people will not be able to find second jobs either because they aren’t available or they cannot be fitted around existing work commitments and family schedules. Working additional hours may also pose a threat to their health or general wellbeing in the long-term.

There are other considerations to take into account in connection to second jobs and the commencement of Scottish trust deeds. For example, is it worthwhile for someone to carry on with a second job if all of the excess income has to be paid into the trust deed? The answer to this may depend upon whether the trust deed is viable without this extra income. It may also depend upon how secure the extra income is. Is it sensible to commence Scottish trust deeds if its viability depends upon an insecure second source of income? Losing the second job might mean that Scottish trust deeds are no longer an available option.

Once Scottish trust deeds are underway, the considerations may be a little different. Will the Trustee allow you to keep a proportion of the income if you take a second job? It may well benefit all the parties involved as your budget will be more flexible permitting the possibility of a higher return for creditors in the long run. This is a consideration which should be formalised before formally agreeing to starting Scottish trust deeds.

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