March Money News: How This Month’s News Could Affect Youfeatured
It’s been a busy month in the world of money saving and personal finance. Following George Osborne’s Budget announcement earlier this month, it’s safe to say the nation has been divided. While many have celebrated the introduction of new savings options for first time buyers, others have criticised the introduction of a National Living Wage which excludes under 25s. Let’s look at a handful of news stories and assess how they could affect you:
Basic rate taxpayers to receive £1,000 tax-free interest annually
If you’re a basic rate taxpayer, from April 6th you’ll be entitled to up to £1,000 a year in savings interest – tax free.
Higher rate taxpayers will be allowed to earn up to £500 tax free interest each year.
Currently, the interest we earn on our savings is taxed before it reaches out accounts (excluding interest saved in ISAs).
With Martin Lewis branding this “the biggest savings shake-up for a generation”, some experts predict that these changes could render traditional Cash ISAs pointless.
George Osborne Announces ‘Lifetime ISA’ to help under 40s save for homes and pensions
In George Osborne’s 2016 Budget Announcement he revealed plans to introduce a new Lifetime ISA to help people save for both a home and a retirement.
The new ISA will be introduced in April 2017 and will reward savers with £1 for every £4 they save. Savers will be allowed to deposit up to £4,000 a year in the account before receiving a 25% top up from the government.
To learn more about this new way of saving for a home and pension, visit my Lifetime ISA Guide.
Introduction of National Living Wage to bump up wages for 4.5 million workers
The National Living Wage will come into force on April 1st - but only for those aged 25 and above. Those who fit the criteria - an estimated 4.5 million workers - will earn at least £7.20 an hour.
While these changes have been celebrated by some, others have questioned why under 25s aren’t entitled to the same amount of money.
23% of under 30s say someone needs to die before they can buy a home
You read that right! A quarter of under 30s believe they won’t be able to buy a home until a relative dies and they inherit money.
I must admit that I let out a shocked little laugh when I first saw this headline and imagined millennials everywhere sat at their grandparents’ bedsides menacingly clutching a pillow in their hands. However, this news is clearly quite depressing when you think about it – for everyone involved!
The findings come from a survey by The House Crowd which asked 1,000 18 to 29-year-olds about their thoughts on buying a home of their home.
36% of those surveyed said they believe they’ll be renting forever. So what exactly is standing in their way?
- 54% say they can’t afford to save a deposit
- 55% say UK house prices are too high
- 35% can’t afford mortgage repayments
- 19% don’t want to be tied down to one location
Petition launched to scrap letting agents fees
Last week The Debrief launched a petition to demand an end to letting agent fees. With just one in ten 16-24-year-olds being in a position to buy a home of their own, the petition asks Housing Minister Brandon Lewis to ditch letting agent fees in order to ‘get a better deal for Generation Rent’.
In an article on The Debrief’s website, features editor Vicky Spratt questioned why fees vary so drastically from agency to agency. She said: “I have paid as little as £80 and as much as £552 in agency fees. Every time you move and go through a letting agent you will incur some kind of cost.”
At the time of writing this post, the petition has approximately 56,000 signatures.
