Holly's Blog: Rishi has put his financial Spanx on
27 May, 2022
Rishi Sunak shakes the money tree again and announces welcome extra support for energy bills. Every household will receive a £400 rebate off their gas and electricity bill this winter. Those on means-tested benefits will get an extra £650 one-off payment, pensioners who qualify for the winter fuel allowance will get an additional £300 in November and those who receive disability benefits will be entitled to an extra £150 in September. Owners of second homes will receive the £400 payment for every property where they pay energy bills.
It had become increasingly difficult to argue against a windfall tax for the energy companies - and even their bosses were sounding less convincingly outraged in their objections. It’s hard to argue against sharing your packet of sweets when the local Cash and Carry has given you three boxes of Skittles instead of one. Especially if you have been banging on about ESG and being a good corporate citizen and caring about the world, social equality and polar bears.
The problem – as Mr Sunak knows – is that it does not take long to go from the nation’s hero, serving up food in Wagamama photo ops, to villain and subject of that week’s savaging on Have I Got News For You. Come the Autumn Budget in October, there will be more cries for help and this won’t be easy to navigate. Covid has redefined state intervention and our expectations of help, and against a tough backdrop, Rishi has decided to put his financial Spanx on, rather than go on a diet. He hasn’t fixed anything, but it looks a lot better tonight.
Pensioners can count on some more dosh next year
This week the Chancellor also confirmed that the ‘triple lock’ would be back next year. This is hugely important for pensioners and means that come April 2023, State Pensions will once again go up by the highest of a) wage growth b) price inflation or c) 2.5%. With the inflation number pegged to the previous September (i.e. September 2022), if inflation hits 10% as envisaged, that would hike the state pension by 10% which will be about £18 more a week.
And some hot tips for everyone – read on….
Loaded? AJ Bell has scrapped all fees on incremental balances over £500,000, so our wealthier readers may like to review their platform fees and see how their current provider stacks up.
Sitting in cash? Got a bit of cash languishing in a current account? Hargreaves Lansdown customers might want to investigate the aligned cash savings service on the platform which according to their PR now has the highest one year fix on the market. The 1-year fixed rate is 2.36% and there’s some cashback thing to boost this a little. And a 6-month fix is paying 1.9%.
Fancy better mobile banking? Chase is making a play to become a big digital banking brand in the UK. I downloaded the app for a snoop (they have the same parent as robo adviser Nutmeg) and I like it. Plus their easy access savings account is paying 1.5%.
In your 20s? I’ve written a feature article for the FT this week – 3 tips for 20-somethings on managing money, with suggested providers I like who can help. FT subscribers can read it here or get the weekend paper tomorrow for a bigger section on money in your 20s.
Need some financial advice? Without a hefty price tag? We launched our new My Money Life pages this week – check them out for 3 ideas of where and how to get help, all split into different age groups (20s through to 70s+) so you’re getting sensible ideas which are realistic for your life stage. Digital and hybrid advice is really gathering a head of steam and is a lower-priced, convenient way to get advice for the millions who don’t get advice today – but kinda wish they did! Thanks for, Destination Retirement, Netwealth for help and content.
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Over and out for this week everyone. I will be enjoying cake, a day off and lashings of bunting next week – so see you in a few weeks!
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