Starting July, several important changes in the UK will affect how people manage their money. These changes include updates to energy prices, bank fees, tax deadlines, and benefit systems. Understanding these adjustments can help you manage your finances better.
Changes in DWP Benefits
From June 2024, many people receiving old-style benefits will move to Universal Credit. This includes those getting income-related Child Tax Credits and Employment Support Allowance. This shift will happen over three months to simplify the benefits system by combining several benefits into one.
According to the Department for Work and Pensions (DWP), about 55% of recipients might see an increase in their payments. However, 900,000 people could get less money. The transition is expected to be completed by March 2025, with some groups transitioning by 2028.
Energy Price Cap Reduction
Starting on July 1, the energy price cap, which limits the amount energy companies can charge, will be reduced. This means the average dual fuel household paying by direct debit will see their annual bill drop from £1,690 to £1,568. This 7% decrease is designed to protect consumers from high energy rates, offering more financial relief.
Bank Fee Increases
Lloyds Bank will increase the monthly fees for some of its packaged accounts in July. These accounts offer benefits like mobile phone insurance and travel insurance.
- Club Lloyds Silver Account: fees will go up from £10 to £11.50 per month.
- Club Lloyds Platinum Account: fees will rise from £21 to £22.50 monthly.
- Club Lloyds Account: the basic fee is £3, which is waived if you deposit £2,000 or more monthly.
Customers need to decide whether these accounts are worth the cost. Some might find the benefits valuable, while others might look for cheaper options.
Inflation Data Announcement
The Office for National Statistics will release the latest inflation data on July 17, 2024. Inflation measures how much prices for goods and services have changed over the past year. Recently, inflation reached the Bank of England’s target of 2%, down from a high of 11.1% in October 2022.
This drop suggests that prices are stabilizing, which could affect consumer confidence and economic policies. The July inflation data will be significant for the Bank of England’s decision on interest rates. If inflation stays around 2%, the bank might lower interest rates, making borrowing cheaper and stimulating economic activity.
Changes to Barclaycard Minimum Payments
Starting July 22, Barclaycard will cut the minimum monthly payments required from cardholders. The new minimum payments will be the highest of three options: 1% of the balance, 1% of the balance plus interest, or £5.
While lower payments can reduce financial stress now, debts will take longer to repay and cost more in interest over time. For example, a £1,000 balance that previously took about nine years and eight months to clear with around £699 in interest could now take 19 years and three months with interest totaling approximately £1,655.
Upcoming Changes to PIP
The Personal Independence Payment (PIP) helps adults with extra costs due to long-term disability or illness. The Government is considering changes to PIP, potentially moving from regular payments to vouchers or one-off payments. The public debate on these changes will close on July 23. This is the last chance for people to give their input, which will help shape the final decision.
Important Dates to Remember
- Self-assessment taxpayers should make advance payments toward their yearly bill by July 31. This mainly affects self-employed individuals and those with untaxed income.
- Those receiving tax credits should renew their claim by the end of July. Renewals ensure eligibility and accurate information. Failure to renew can terminate benefits, affecting your financial situation.
Overall, these changes highlight the importance of staying informed and planning ahead. From energy price reductions to benefit system changes, understanding these updates can help you manage your finances more effectively. Keep visiting our website to stay updated on these new changes and optimize your financial health.
What changes are happening in DWP benefits?
Many people receiving old-style benefits will move to Universal Credit, simplifying the benefits system.
How will the energy price cap change affect my bills?
The energy price cap will be reduced, lowering the average dual fuel household’s annual bill from £1,690 to £1,568.
What are the new fees for Lloyds Bank accounts?
Lloyds Bank will increase fees for some packaged accounts, including the Club Lloyds Silver and Platinum Accounts.
How does the latest inflation data affect me?
The July inflation data will impact the Bank of England’s interest rate decisions, potentially lowering borrowing costs.
What are the changes to Barclaycard’s minimum payments?
Barclaycard will reduce the minimum monthly payments required from cardholders, which may extend the time and cost of repaying debts.