This week’s Budget was the first delivered by new Chancellor Rishi Sunak and, given the challenging conditions (this blog is strictly virus free) generally received a positive reception.
Naturally here at Youtility we were watching closely for updates that might impact your finances as well as looking out for any changes that would affect us as a business.
Here are the key findings from the Budget that may impact your money:
- The UK National Living Wage (NLW) will rise 6.2% from next month to £8.72. Mr Sunak also confirmed the NLW was set to hit £10.50 an hour by 2024. This doesn’t just affect take-home-pay either – pension expenses will increase too
- The National Insurance threshold is also rising as of next month, from £8,632 to £9,500. This means that 31 million people around the UK can expect to be better off by around £100 per year
- VAT on digital books, magazines and newspapers is being cut which is good news for all avid readers out there
- Fuel duty is frozen again, along with duties on alcoholic drinks which means your pint won’t suddenly become more expensive due to tax
- The Tampon Tax (5% rate of VAT on sanitary products) is also being scrapped from January onwards
- The Chancellor committed to more than doubling the annual subscription limit for Child Trust Funds and Junior ISAs from £4,368 to £9,000
The biggest change from a day of announcements came from the Bank of England which, just hours before Mr Sunak took centre stage, announced an emergency base rate cut – from 0.75% to 0.25%, the lowest in history.
This is either good or bad news depending on whether you’re a saver or a borrower. For savers, the rate cut is a further blow and means that you’ll get lower rates on your savings than before.
For borrowers, the base rate cut is more welcome news and depending on what mortgage type you have, could see you save money on your repayments. If you’ve got a tracker mortgage or standard variable rate you could see your monthly bills go down – although this is at the discretion of your mortgage provider.
Although many of us will save smaller amounts with the changes announced in the Budget, some of the bigger impacts won’t hit your wallet for a while. Home finances is one area where you could potentially save money right away, rather than wait for changes to come into play. The Youtility app lets you take control of your finances and ensures that you’re always on the best deal available to you, saving both your money and your time. You can find out more here: https://youtility.co.uk/consumers
And something for those more interested in the Fintech market…
As part of the Budget, Mr Sunak also announced some exciting news for the UK fintech industry. As part of its goal to further boost the growing sector, he confirmed that a review of the sector was upcoming, looking into how the government can continue to support growth and competitiveness amongst fintech businesses.
Here at Youtility we welcome the news and look forward to continuing to work in such an exciting ecosystem.