I do, quite frequently, think about getting health insurance. To this day I have yet to actually have something push me to take the leap and get a policy, but I feel a couple of bad experiences away from doing so.

My experiences with NHS healthcare have been varied, unfortunately. But largely this has not been for myself (thankfully), rather I have watched (and helped) family go through the system a lot.

I have had both parents in the system to a significant degree at varying times. My wife has been through the maternity system with our first son (and is currently on her way through it a second time).

I’m not going to go into the details of those experiences as they are deeply personal, but safe to say they were very mixed – particularly for my parents.

The maternity and subsequent paediatric provision has always been great, I will say. It will be interesting to see how experiencing the same process two years on differs with our second child due in December.

Where my personal sentiment on the NHS begins to chafe really comes down to the primary services we receive. I can count on one finger the number of times I’ve ever actually been granted access to my current GP, for example.

We routinely have to queue, sometimes for up to an hour, for our local pharmacies to fulfil prescriptions. This is thanks in large part to a major national pharmacy chain withdrawing from our town and putting pressure on the remaining provision.

And dental – don’t get me started. We live in a dental desert and have to drive over an hour away for an appointment. That appointment isn’t even on the NHS, those are rarer than (healthy!) hens teeth in Devon.

But does this push me into getting private medical insurance for our family? Our problem is largely a primary care deficiency.

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Time for health insurance?

The reality for our situation is that it feels hard to apportion some of our monthly income to a health insurance policy because, frankly, so much of my income already goes on taxes which pay for the NHS.

The Government has a fun tool you can use to tell you exactly how much of your taxes went where in a given tax year, out of interest. I am aware this is getting into the territory of crying over a sunk-cost fallacy but it hurts to look nonetheless.

In the most recent tax year, 2023/24 – just over 20% of my tax went to the NHS. This works out at just under £4,000 a year. My partner earns less than me (and ironically enough is a n NHS nurse which provides its own insights into the Byzantine Health Empire which I will forgo for today), but between us I’d calculate we’re roughly paying in around £6,000 a year just to the health system.

This is great inasmuch as we’ve actually used it quite a lot having our son etc. But it is also certainly a lot more than we’d pay for equivalent private health insurance, which comes without the queues and more free smart watches. For context – a private policy runs between £70 and £200 depending on circumstances.

So even if myself and my wife were both paying the top end (we wouldn’t because we’re under 40) we’d still be paying less than the equivalent in tax.

Controversially (and perhaps under-noticed as of yet) political parties such as Reform have floated giving people tax breaks for opting out of NHS care and using private insurance. Given the potential cost differential already mentioned, this could be an extremely compelling way to save tax for people who would have lower annual premiums (i.e. the healthy and young).

But the implications are fraught especially given that it is the taxes of the healthiest who are essentially footing the bill for those in poor health in the nationalised system.

In totality, the Government spent around £258 billion on healthcare in 2024. That’s a big number. For context, the Government spend £1,279 billion on everything it does in the tax year 2024/25.

Brits spent around £46 billion on so-called ‘out-of-pocket’ healthcare expenditure in 2024. What this means is for all the money spent on healthcare in the UK, around 15% came out of our own cash. The Government spends 81% of the money. Just 2.6% of spending is done by private health insurance schemes.

Interestingly, the out-of-pocket spending used to be higher – 20% in 1997. At that time health insurance accounted for just under 4%. What this tells me is that there is still a significant unsatisfied demand for private healthcare coverage. Why?

In this week’s podcast we were joined by Dr Katie Tryon, chief commercial officer at health insurance provider Vitality. We got Katie on the podcast as probably one of the best-placed people in the country to actually explain to us the nuts and bolts of how health insurance works.

For a more detailed guide, we’ve also written up all you need to know on health insurance.

Dr Tryon explained on the podcast that the biggest area of growth that Vitality is seeing with regard to its health cover is thanks to the deficiencies of NHS primary care (i.e. GPs) – the exact issue my family and I face routinely. Our problems are being mirrored up and down the land and this is driving people to spend money, regardless of the sunk cost of their tax.

But they’re not buying insurance instead. And this is costing us, collectively, billions every year.

My challenge here then, is how do we solve the clear issue of a lack of coverage? While I still don’t feel as if my family is at the point of taking the leap, what is clear is we’re collectively as a nation spending a lot of money on health treatments that could potentially be covered more affordably by the pooling power of the insurance market.

My worry is that it is a mindset issue. We eulogise the NHS. For many reasons this is perfectly fair given the nature of the institution and the impact it has on many of our lives.

Personally, I have seen the NHS at its best with the birth of my son. It was truly remarkable. Enough to make me clap on a Thursday evening. But I have also had a good look at it at its worst, particularly with what I went through with my mother many years ago.

Private healthcare is so often the bogeyman in arguments about how the NHS works and is funded. It is seen as the evil vulture capitalist in the room looking to ruin nationalised health from under our noses. But the mad thing is, while we argue over this, in the breach it is creating a coverage gap that is just making us poorer and less healthy.

It’s time we thought again about how to ensure everyone has their healthcare needs covered – through a combination of national and private health that doesn’t rely on judgement, just beneficial outcomes.

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The decision reflects a delicate balance act the central bank is facing between curbing inflation and supporting growth.

Three members dissented, voting for a rate cut citing a softening labour market and subdued consumer demand.

The MPC noted that underlying UK GDP growth remains weak, while the labour market is ‘loosening’ – i.e. more people are losing jobs.

Consumer Price Index (CPI) inflation is expected to peak at 3.7% in September before stabilising just below 3.5% by the end of 2025.

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Uncertain picture for household finances

The Bank’s most recent decision is taken against a persistently unclear outlook for households to plan against.

Most watchers believe it will cut its rate to 4% in August, eventually reaching 3.5% some time next year. But the MPC has taken a ‘two steps forward, one step back’ approach for some time, disappointing mortgage holders in particular.

Nicholas Hyett, investment manager at Wealth Club explains why the situation is so complicated: “The Bank of England’s goal over the last two years has been to slowly bring down inflation without crashing the economy – achieving a so-called soft landing, that’s not easy at the best of times let alone when the economic data is unreliable.

“Official data suggests the Bank has so far done a pretty good job, with the UK labour market holding up well. The problem is that data has never been more unreliable, and elsewhere there are signs of strain. Just this morning recruiter Hays said that it is experiencing significant weakness, with a 13% revenue fall in UK & Ireland as hiring for permanent positions softens.

“Inflation numbers too are subject to uncertainty and had to be restated last month after an error in the data. Conflict in the Middle East risks higher energy prices potentially pushing inflation higher – though calling the course of events there is almost certainly a mugs game, and the Bank has said that under current conditions it expects inflation to remain broadly at current levels for the rest of the year.

“The risk is that all the uncertainty leaves the Bank paralysed, with rates stuck at their current level. With uncertain data, policy setters will need a really compelling reason to hike or cut interest rates and that could result in default driven decisions.”

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The Pensions and Lifetime Savings Association (PLSA) has released its latest Retirement Living Standards update, revealing a notable decrease in the cost of a minimum retirement lifestyle, while moderate and comfortable standards have seen increases.

The changes are driven by lower energy prices and shifting public expectations on retirement income levels.

For a two-person household, the cost of a minimum retirement lifestyle has dropped to £21,600 annually, down £800 from previous levels, while a one-person household now requiring £13,400, a £1,000 reduction.

The decline is largely attributed to a significant fall in energy costs, with weekly domestic fuel budgets for a two-person household at the minimum level decreasing by £12.44 and by £8.82 for one-person households.

These savings reflect broader economic shifts, including lower energy prices, which have eased financial pressures for retirees at this level.

Zoe Alexander, director of policy and advocacy at the PLSA, said: “For many, retirement is about maintaining the life they already have not living more extravagantly or cutting back to the bare essentials. The Standards are designed to help people picture that future and plan in a way that works for them.

“Everyone’s situation is different, and contributions should be manageable. But if your circumstances improve, even small increases can make a big difference to your future.

“This year’s findings show that costs can go down as well as up. But planning matters more than ever. Whether you’re on your own or sharing your future with someone else, these Standards are here to help savers picture and plan their retirement – with real figures, real choices and real flexibility.”

The Retirement Living Standards, calculated by Loughborough University’s Centre for Research in Social Policy, are based on in-depth discussions with UK residents to define three retirement lifestyles: Minimum, Moderate and Comfortable.

While the minimum standard saw reductions, the moderate and comfortable standards have risen slightly due to inflation across various expenditure categories, though lower energy costs – down £16.74 and £15.38 per week for two- and one-person households, respectively – helped offset these increases.

Professor Matt Padley, co-director of the Centre for Research in Social Policy at Loughborough University, said: “Our research on what the public agree is needed in retirement at these three different levels continues to track changes in expectations, shaped by the broader economic, social and political context.

“The consequences of the cost-of-living challenges over the past few years are still being felt, and we’ve seen some subtle changes in public consensus about minimum living standards in retirement, resulting in a small fall in the expenditure needed to reach this standard. 

“In these uncertain times, planning in concrete ways for the future is ever more important, and the RLS help people to think in more concrete ways about what they want their retirement to look like, and how much they will need to live at this level.”

Public discussions also highlighted evolving expectations for the Minimum standard, with small adjustments in spending on clothing, hairdressing, technology, taxi use, and charitable giving. However, rail travel budgets increased, rising from £100 to £180 per person annually, reflecting higher fares and greater reliance on trains for longer journeys.

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This year’s update introduces new terminology, replacing “single” and “couple” with “one-person” and “two-person” households to better reflect modern retirement living arrangements.

A PLSA survey found that 75% of people live with family members, 22% live alone, and 3% share with non-family members. Looking ahead, 77% of non-retired individuals expect to live with someone in retirement, with only 12% preferring to live alone, signaling openness to shared living to reduce costs.

The RLS serve as a guide, not a rigid target, encouraging retirees to tailor plans to their lifestyles.

Alexander urges savers to consider pension contributions beyond the 8% automatic enrolment default, suggesting 12% or more for a better chance at their desired retirement.

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The UK Government has revealed plans to double the number of pension megafunds managing £25bn or more by 2030 through the upcoming Pension Schemes Bill.

The reforms will consolidate multi-employer Defined Contribution (DC) pension schemes and Local Government Pension Scheme (LGPS) pools to boost investment in UK infrastructure, housing and businesses, with an estimated £50bn to be channelled into the economy.

The move is aimed at addressing a decline in domestic pension fund investments.

Currently, only about 20% of DC pension assets are invested in the UK, down from over 50% in 2012. The reforms mandate that DC schemes and LGPS pools operate at megafund scale, managing at least £25bn by 2030.

Schemes with over £10bn unable to meet this target must outline plans to reach £25bn by 2035. The Government cites Canada and Australia, where larger funds invest in infrastructure and private businesses, potentially yielding higher returns.

Consolidation is projected to save £1bn in scheme fees annually by 2030 through economies of scale and improved governance. The Government estimates an average earner’s DC pension pot could increase by £6,000 at retirement, with further gains expected from the Pension Schemes Bill, though these depend on market performance and implementation.

The bill will also permit DC schemes to transfer savers’ assets into better-performing funds and grant powers to enforce asset allocation targets.

The pensions minister Torsten Bell, comments: “Our economic strategy is about delivering real change, not tinkering around the edges.

“When it comes to pensions, size matters, so our plans will double the number of £25 billion plus megafunds. These reforms will mean bigger, better pension schemes, delivering a better retirement for millions and high investment in Britain.”

Deputy Prime Minister Angela Rayner also noted in the announcement that consolidating the £392bn LGPS into six pools could support local priorities for the 6.7 million public servants whose savings are managed through such schemes. Local investment targets are expected to secure £27.5bn for regional projects.

The Pension Schemes Bill will also address small pension pots and require schemes to demonstrate value.

What this means for UK pension holders

For UK workers with DC pensions or LGPS memberships, the reforms may alter how their savings are managed. Savers could see their pension pots moved into larger megafunds, potentially benefiting from lower costs and diversified investments in infrastructure or businesses.

However, the projected £6,000 boost is not guaranteed, hinging on market conditions and fund performance.

Public sector workers may see their pensions increasingly fund local projects, raising questions about investment risks.

The Pension Schemes Bill will introduce measures to ensure value for money, but savers should monitor how their funds are managed and the implications for their retirement.

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Concerns over compelling domestic investment

The Government plans to legislate asset allocation targets, including a 5% commitment to UK assets. This has sparked concerns that compelling certain investments could lead to inferior outcomes. 

Critics argue that forcing pension funds to prioritise domestic projects could compromise returns, as investment decisions may be driven by policy rather than financial merit.

Private markets, such as infrastructure or start-ups, often carry higher risks and costs, potentially affecting savers’ pensions if projects underperform. There’s also worry about reduced diversification, as over-concentration in UK assets could expose funds to domestic economic volatility.

For LGPS members, local investment targets might lead to scrutiny over whether projects align with community needs or favour political priorities. While the Government insists savers’ interests will be protected, some fear the reserve powers to enforce targets could limit fund managers’ independence, raising questions about long-term pension security.

While framed as a step toward economic growth, the reforms’ impact on savers and the economy remains uncertain.

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The Government is giving itself power to force pension schemes to invest in the UK. This would set us back onto the path to financial repression.

Financial repression is something we’ve largely forgotten about as a concept in the UK.

But for around 30 years after World War II it was one of the most important – and pernicious – policies for economies looking to bury their bad debts.

With the Government set to give itself the power to compel financial institutions in the UK to invest pension scheme members’ money into British assets – we are on the cusp of returning to that era.

Before I get into the ins and outs of financial repression – I must say (and did make clear in this week’s podcast) that this is just the beginning of a policy journey that could take any number of directions. But the scene is now set for what is to come.

What is financial repression?

Financial repression is a mechanism used by Governments which face painfully high national debt levels.

Financial repression comprises policies that result in savers earning returns below the rate of inflation to allow banks to provide cheap loans to companies and governments, reducing the burden of repayments.

It can be particularly effective at liquidating government debt denominated in domestic currency.

There are a few ways the Government can do this:

1. Explicit or indirect capping of interest rates, such as on government debt and deposit rates.
2. Government ownership or control of domestic banks and financial institutions with barriers that limit other institutions from entering the market.
3. High reserve requirements.
4. Government restrictions on the transfer of assets abroad through the imposition of capital controls.
5. Creation or maintenance of a captive domestic market for government debt, achieved by requiring financial institutions to hold government debt via capital requirements, or by prohibiting or disincentivising alternatives.

Point number five sounds an awful lot like what the Government has announced today with regards to compelling UK pension scheme to invest domestically.

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Why is this an option for the Government?

In the situation we are in today – with a debt-to-GDP ratio of over 100% – the Government faces tough choices about how it continues to raise, and spend, money.

It is politically toxic to cut spending (austerity) but it is also practically impossible to tax more too. Both would seriously hamper economic growth – something desperately needed to improve people’s standards of living and ensure the country doesn’t collapse into chaos.

This is where governments reach for this little-understood policy tool – financial repression.

This tool works in a number of ways, but the main purpose is to force savers to accept lower returns, generally leaving their pots worse off against inflation.

Over time as the economy grows, this makes the relative size of the national debt look smaller as a percentage of GDP. It makes the Government’s debt repayments more affordable and means it doesn’t have to make the aforementioned unpalatable political choices.

We have historic precedent for this – it is exactly what a series of governments between around 1945 and the 1970s opted to do. In the wake of World War II, national debt sat at more than 200% of GDP – even worse than the current predicament.

By the 70s this had fallen to less than 30% – all thanks to financial repression.

It was decided – over many years – that it was a policy choice worth making despite its effects on savers, in order to avoid drastic spending cuts or tax rises. It was the ‘least worst’ option.

Who is worst affected?

The winners and losers of financial repression are fairly easy to define.

Winners include the Government, who gets to devalue its debts. Working people who aren’t big asset owners also potentially win as services aren’t cut and taxes aren’t raised. That is subject however to workers ensuring their pay rises with inflation consistently.

The big losers are savers – or anyone with assets that have to stay ahead of inflation.

The Bank of England is currently cutting its base rate, all while inflation is ticking up close to 4%. This in effect creates the perfect conditions for financial repression to take place.

The point here is that the Government is unable to tax wealthier pensioners (see why they’ve reversed on the winter fuel allowance cuts) without facing severe consequences at the ballot box.

Instead, financial repression acts like a stealth tax on asset holders/savers. The Government can simply point to the rising cost of living as to why retirees suddenly find their pension and savings incomes aren’t keeping up with costs.

Of course, there is a significant caveat in this thanks to the state pension and its associated triple lock.

In an environment that punishes savers (read: pensioners) the state pension triple lock provides an income guarantee at the bottom of the wealth pyramid. This means that financial repression is to an extent ‘progressive’ in that it is wealth that is taxed away, so the more of it you have, the more you stand to lose.

Again, we’re not in the middle of this yet, but we are now on the path to it with these pension law changes.

And the reality is that this may be our only answer to the horrendous fiscal situation the country finds itself in. at the end of the day someone is going to have to feel the pain in order to put the national finances back on an even keel.

It might be that financial repression is the only option to do that now.

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Have you ever had financial advice? I have, in a few different formats.

It is important to realise that financial advice isn’t something that the ultra-wealthy get and not something we all have access to in one way or another.

I’ve had advice on our mortgage (and we were very happy with the deal). I will have to go back in a couple years to get it again when our deal is up.

I was given advice on life insurance and income protection. Although my life insurance experience was disappointing at the time (although the adviser was excellent) – I do now how an income protection policy, which I was advised into.

These were good experiences in terms of the advice I felt I received. Unfortunately, I have also had one bad experience.

When I was much younger and getting started with my career as a freelance journalist, I was advised (admittedly informally) to not bother getting a pension.

This was bad advice and has almost certainly set back my future retirement plans by about four years, as it delayed my first pension pot starting until I got a full-time role in the UK in 2016.

Crucially, I did not know this was bad advice at the time – because the adviser was the exert and I was a graduate with absolutely no financial knowledge to speak of.

Fortunately, I now know better.

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Why advice matters

The industry on the whole – from mortgages to life and general financial advice – has come on considerably since those days.

The sector does suffer from a major problem with the advice gap. This gap is essentially the gulf between what financial advisers are permitted to offer and the minimum level at which giving that advice becomes commercially viable.

The Government and regulator are fortunately looking at the issue, but it remains to be seen what kind of fix we get.

I have recently begun a regular series of interviews with financial planners for Mouthy Money’s partner site Octo Members. You can catch the first edition of that with Smart Financial’s Kate Morgan on Mouthy Money.

Since I began (and we are still very much at the start) the sense I’ve gotten from the diverse range of planners is that these people have their clients at heart.

Yes, the process costs money – but they seem unanimously dedicated to the best outcomes for people who need help with their financial lives.

Importantly, it is about more than just bunging savings into particular pots and deciding what to invest in – planners look at a whole range of issues from inheritance to tax liability, planning for later life care and the longevity of a retirement plan.

Crucially, we want to showcase how financial planners think about their jobs and the roles they have to play in people’s lives – in order to better demystify the process and how it might be useful to normal people.

This forms a key part of Mouthy Money’s mission – to help people grow, protect and enjoy wealth no matter where they come from in life.

We’re going to be sharing these conversations first on Octo Members, but also here on Mouthy Money in order to get a better insight into what makes financial planners tick and why what they do matters to ordinary people. Stay tuned!

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On 2 April 2025, US President Donald Trump unveiled his ‘Liberation Day’ tariffs, a sweeping set of import taxes aimed at reshaping global trade and boosting American manufacturing.

The UK has been hit with a blanket 10% tariff on all imports to the US, with varying tariffs on particular industries such as automotive and pharmaceuticals – both significant exports for the UK economy.

Other countries and regions have been slapped with much higher rates, such as 20% on the EU and 34% on China. Considering the heavily interwoven nature of the global economy and supply chains, this could have significant effects on the UK regardless.

Here’s how it could impact your wallet, from the global economy to your investments and everyday costs.

The global economy

Trump’s tariffs signal a retreat from decades of globalisation, targeting countries with trade surpluses and imposing costs on imports.

Economists warn this could slow global trade volumes, a key driver of economic growth. For the UK, an open economy reliant on international trade, this isn’t just a distant concern.

If major trading partners such as the US, EU, or China stumble into recessions – or retaliate with their own tariffs – demand for British exports could weaken, indirectly hitting jobs and growth here.

Much also depends on how the UK Government responds to the tariffs. If it chooses not to retaliate it could dampen the overall impact. Tariffs affect the buyer country – this means US consumers will end up footing the bill for their imports. UK consumers will only be hit upfront if the UK Government chooses to impose retaliatory tariffs.

If the UK maintains a low-tariff environment on its imports it could also prove a favourable alternative market for countries such as China, which could have a positive impact on prices as surplus goods come here instead.

Further, with the EU – a closely associated economic bloc – could see some companies look to base in the UK due to its more favourable tariff levels with the US. This could be good for UK growth and employment.

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Investments: uncertainty hits the markets

If you’ve got money in stocks or pensions, brace for turbulence.

Global markets shuddered after Trump’s announcement, with US stock futures dropping sharply and European indices like the FTSE 100 feeling the strain.

This is down to a mixture of effects. Tariffs could dent corporate profits, especially for firms reliant on international supply chains- think carmakers or manufacturers.

However, there’s a silver lining: if the UK dodges the worst of Trump’s wrath, some investors might see Britain as a relative safe haven, potentially boosting demand for UK assets.

Still, higher borrowing costs and trade war fears could weigh on your portfolio’s value in the short term. As ever, diversification is important, as is not panicking in the face of short-term turmoil.

Inflation and interest rates: a global price push

Across the Atlantic, Trump’s tariffs are set to hike prices for American consumers as importers pass on costs.

This matters for Brits because global inflation tends to spill over. If US interest rates stay high to combat this – thanks to the Federal Reserve’s mission to fight inflation – global borrowing costs could rise too.

Higher US rates often push up yields on UK Government bonds (gilts), increasing the cost of everything from mortgages to Government debt.

For Brits, this could mean pricier loans or credit card bills if the Bank of England is forced to follow suit.

UK economy, inflation, and interest rates: a mixed bag

The UK’s direct hit is a 10% tariff on exports to the US, our largest single-country market for goods such as cars. This could cost jobs and slow growth in these major sectors and lead to higher inflation levels thanks to a strong dollar.

Yet, there’s a twist: if US tariffs divert cheap goods (such as Chinese steel) to the UK, prices for some items could fall, easing inflation in some areas.

The picture here is very murky, which is why investment markets are responding very nervously. We won’t know the full effect of the Trump tariffs on the UK economy for some time.

It is clear though that the UK is facing major challenges already – this clearly isn’t going to help.

What can you do?

Trump’s tariffs are a gamble with global stakes, and our personal finances aren’t immune.

Keep an eye on your investments – ensure your risk is spread carefully across sectors or regions less exposed to trade wars.

If inflation creeps up, locking in fixed-rate deals on loans or savings could shield you from rising costs. And while the UK Government negotiates to soften the blow, staying informed will help you navigate the uncertainty.

Liberation Day may be Trump’s vision, but its fallout is everyone’s reality. Keep a cool head in the meantime.

This article is for informational purposes only and should not be considered financial advice. If in doubt, seek professional advice.

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Picture the scene: you’ve found the perfect home, secured your mortgage offer and it looks like everything is on-track to move in before the end of March, as you’d hoped.

Then things grind to a halt. The property chain you’re in is gummed up, paperwork has gone missing and your solicitor seems to have vanished.

It suddenly dawns on you – you won’t complete before 31 March. You’re frustrated. You’re angry.

Why? Because it means that you’ll miss the looming Stamp Duty deadline and potentially have to pay thousands more in tax.

If that sounds familiar, you’re not alone. 

74,000 buyers, including 25,000 first-time buyers (FTB), could miss the deadline, facing a collective tax hit of up to £142 million, according to property directory Rightmove.

That’s because, from 1 April, a temporary increase in the nil-rate band – the threshold below which no stamp duty is paid – will expire after nearly two years.

From 1 April, FTBs will start paying tax from £300,000, instead of £425,000. Anything between £300,000 and £500,000 will be taxed at 5%.

That means a FTB purchasing a home at the national average (£268,087, according to the Land Registry) will continue to pay nothing. 

However, a FTB in London purchasing a £450,000 property will see their tax bill jump from £1,250 to £7,500.

It’s not just FTBs who will be hit. 

From 1 April, home movers will start paying tax from £125,000, rather than £250,000, as it is now. They’ll then pay 2% on the portion between £125,001 and £250,000, and 5% on amounts up to £925,000.

If you’re a buyer, missing that deadline will be incredibly frustrating. But is it a disaster? Maybe not. 

Granted, you’ll have to find the extra tax up front, which may mean having to raid your savings or, in some cases, delay your purchase.

But if interest rates fall over the next 12 months, as expected, you may be no worse off over the long run.

The current consensus is that the Bank of England will cut interest rates from 4.5% now to around 4% by the end of the year. Some experts believe they could fall to as low as 3.5%. That’s one percentage point less than they are now.

While mortgage rates aren’t directly tied to the base rate (they’re influenced by swap rates and global markets), a lower base rate often leads to cheaper mortgages over time.

And if mortgage rates fall enough, you could actually save more over time than you lose in upfront tax.

Mortgage numbers crunched

To show you what I mean, let’s imagine two scenarios: buying now with lower tax or waiting a year and paying higher tax, but securing a mortgage rate that’s one percentage point lower. Both properties are in England. 

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Scenario one: buy before the stamp duty deadline

• Purchase price: £268,087 (the current national average).
• Mortgage: five year-fixed rate at 90% loan-to-value (LTV), 5.4% interest rate (the current average at this tier). 30-year mortgage term.
• Stamp duty: £904.35.
• Five-year total cost (stamp duty plus five years’ worth of mortgage payments): £82,195.47.

Scenario two: wait a year

• Purchase price: £276,129 (same property but assumes prices have grown 3% in that year).
• Mortgage: 90% LTV at 5.4% for the year you spend in your old property, then 4.4% for the next four in your new property. 30-year mortgage term.
• Stamp duty: £3,404.
• Five-year total cost: £80,796.69.

Despite paying more stamp duty, you’d be nearly £1,399 better off over five years if you’d waited because lower mortgage rates have cancelled out the extra tax.

Now let’s try another example, but this time we’ll assume that you’re a home mover purchasing a £450,000 property.

Scenario one: buy before stamp duty deadline

• Purchase price: £450,000
• Mortgage: five year-fixed rate at 90% loan-to-value (LTV), 5.4% interest rate. 30-year mortgage term.
• Stamp duty: £10,000
• Five-year total cost (including stamp duty and mortgage payments): £146,451.98

Scenario two: wait a year

• Purchase price: £463,500 (same property, but assumes prices have grown 3% in that year)
• Mortgage: 90% LTV at 5.4% for the year you spend in your old property, then 4.4% for the next four in your new property. 30-year mortgage term.
• Stamp duty: £113,175 (£3,175 more)
• Five-year total cost (stamp duty and five years’ mortgage repayments): £142,407.63

In this example, you’d be more than £4,044 better off over five years, despite your higher tax bill, thanks to the lower mortgage rate you have secured on your new property.

In fact, your new mortgage rate would only need to be 0.66 percentage points lower than your current one to cancel out the effect of higher taxes.  

Clearly, the examples above are just illustrations, and they rely on certain assumptions about property values, house price growth and mortgage rates.

We can’t be sure, for example, that house prices will only increase 3% this year, although that’s what Halifax, the nation’s biggest mortgage lender, believes. 

Similarly, we can’t be sure mortgage rates will fall by one percentage point over the next year – or at all. 

I’ve also ignored FTBs in my calculations. There are two reasons for this: firstly, they will continue to pay nothing for purchases under £300,000, which should cover FTBs in most of the country outside London. 

And second, I would need to make some additional assumptions about rents for the second scenario. This would make like-for-like comparisons difficult.

But what I hope I have shown is that while it would be (incredibly) frustrating to miss the stamp duty deadline, it isn’t necessarily the end of the world. 

That’s not to say that you shouldn’t try to complete by 31 March if you can, as your savings will be even greater over the five years, especially if mortgage rates fall.

Therefore, you should make sure you are flexible, have all your paperwork to hand and are willing to badger your lender, broker and solicitor if necessary.

But if it’s looking increasingly likely that you’ll miss the deadline, don’t stress about it. Over the long-term, the impact may be far smaller than it seems today.

Photo credits: Pexels

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What do you want from your retirement? It’s a big question. The younger you are, the harder it might be to have a clear picture in your head.

There are plenty of stock responses we’re all probably conditioned to consider:

• “Take a cruise!”
• “Travel the world!”
• “Buy a house with a sea view!”
• “To the Lamborghini show room!”

But retiring plans don’t have to be ambitious. Having a plan, or at least a vague idea, is worthwhile though.

For my part, I have an image of a comfortable (and easy to maintain) country cottage, with a patch out back big enough for some chickens (and a labrador).

A nice study with a leather chair where I can read and write (and probably fall asleep in) with a cosy fireplace.

In short, I want somewhere quiet, self-sufficient and sustainable.

I love to travel, visit new places and learn about new cultures. But truly, I don’t think I want to have to do that when I’m 70.

I want to take my son to these places and open his eyes to the wide world out there while he’s still young. And I want to be able to do things while I’m still spritely enough to enjoy them too.

What does that mean in practice? It means I don’t have to be so hard on myself while I’ve still got something like youthful vigour. I have very little interest in living in penury in order to maximise my cash pile when I’m geriatric.

All too often, the message is rammed down our throats by financial services and Government alike that we need to plan for infinitesimal retirements where we could live to be 150 and need barrels of money to keep us going. But it’s not true.

What you need is a plan and a sustainable way to achieve that without making your life a total misery.

And once you reach some of those goals (or at least, the financial equivalents therein), you need not be so worried about using the resources you’ve built to actually go out and have the life you want to live.

Ask our experts your money questions

This was the subject of this week’s podcast with guest Dan Haylett. Dan has some very enlightening views on why people should actually set out to enjoy their hard-earned wealth instead of sitting on a pile of gold coins like old Tolkien’s Smaug.

But if for nothing else, the problem with sitting on all that money forever is financial firms love it because they can keep charging fees, while the Government loves it because you’re not their problem if you take care of yourself (despite the fact your taxes paid for others to enjoy those same benefits today).

I really loved Dan’s suggestion in our podcast catch up that you should break the journey down into much smaller steps. Where do you want to be in nine years? What about three? Keep pushing forward but don’t let the horizon be so far off that it seems like you’ll never get there.

Make a plan. It doesn’t have to be exact, but have one. Even if it’s just a general direction of travel, so to speak. Future you will thank you. My future chickens, Henrietta, Mildred and Prudence will thank me too.

Photo credits: Pexels

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Who does the Government think it is fooling when it says we’re just getting a run of the mill update and not a full Budget from Chancellor Rachel Reeves?

Rachel Reeves is due to deliver her second fiscal announcement of her career as the Chancellor of the Exchequer on 26 March.

It would be really easy for me to just list out what’s coming up. We don’t know a lot but we do know she might be of a mind to tweak the cash ISA allowance.

We also know that her and her boss, Prime Minister Keir Starmer, now seem quite keen on some fairly substantial welfare cuts – plus a mini bonfire of Government quangoes that cash cheques and do little else.

So far it’s all a bit of a DOGE tribute act. Which is weird for a left-wing party but here we are.

But the bone I’m keen to pick today isn’t about these policy measures. If you’d like to hear more about that in detail, please have a listen to our latest podcast episode with interactive investor personal finance editor Craig Rickman instead.

No, as the title suggests, the problem I’ve got is the fiction we’re all being told to believe that this somehow isn’t a ‘Budget’.

Budgets vs Statements

Now, the difference between a Budget and a Statement is one of measures. The Budget contains lots of tax and spend measures while the Statement just has the fiscal forecasts and other numbers update.

But in practice does it ever work like this?

I would argue if Rachel Reeves is about to gut £6 billion from the welfare bill she is veryn much not just doing a Statement – it is a full-blown Budget.

Okay, well, why does that matter? It matters because:

a. Reeves said she’d only do one Budget a year. If she admits that has immediately been upgraded to two, it is admitting the first Budget was, well, a bit of a failure for not getting stuff buttoned up for 12 months.

b. It matters to big and ugly stuff like the bond market. Everyone from Westminster to the Square Mile is now quite nervous about upsetting the so-called ‘bond vigilantes’ and triggering another Truss-style meltdown.

Ask our experts your money questions

If Reeves admits she’s having to do a full whack announcement (and with it, more debt, spending, tax, etc that comes with that) then the bond market might be quite unhappy about more uncertainty on uncertainty. It risks scaring the horses, so to speak.

In reality this all doesn’t really matter that much, but the fiction that we’re just getting a perfunctory business update is working quite hard to play down some of the fairly serious problems facing the UK economy. By not facing that head on we’re just trying to minimise big problems that need tackling – ASAP.

Photo credits: HM Treasury

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