An increase in the Bank of England base rate of interest is increasingly likely, following an extended period at its historically low level of 0.5% – but how might this affect credit control in work at home jobs?
There may not seem like a direct link between the two issues, but for people who work at home, there is often a much closer relationship between their domestic finances and their job, particularly for those who are self-employed or who work on a freelance basis.
For those people, their home is also their office, and a base rate rise could have a direct impact on their business overheads as a consequence of higher mortgage repayments.
In effect, if you deal regularly with self-employed individuals or micro-businesses based at home, then the impact of a base rate rise could have quite direct implications in terms of your approach to credit control.
There is also the issue of people’s own credit control in work at home jobs – and figures from TSB reveal why a lack of personal awareness could spill over into poor business cash flow for people in such roles.
According to the bank, 20% of homeowners have no idea how their mortgage repayments would change in the event of a rate rise.
The majority – 56% of those surveyed – already struggle when it comes to paying their bills on time, and for those whose job is based at home too, that should be a cause for concern among their suppliers.
In TSB’s research, 33% of people said they would prioritise debt repayments if their mortgage costs went up – perhaps a further warning sign to business suppliers that invoices might be delayed or simply not paid at all.
And 30% claim they would take on a second job or work overtime to earn more, which could put their ability to pay their invoices in the hands of a third party – particularly in the case of working from home for an entirely new customer.
For those planning to do so, the issue of credit control in work at home jobs is directly relevant not only to guaranteeing prompt payment for work done, but potentially in ensuring the money is in the bank when the next mortgage repayment is due too – blurring the boundary between professional and domestic life even further.