The Salary Calculator

Green home upgrades to help you save money

by Madaline Dunn

Although the energy price cap dropped to £2,074 on 1 July 2023, it’s still significantly higher than it was before, and many are still struggling to pay their energy bills. As a result, many are looking for ways to make their homes more energy efficient with green upgrades. In fact, research shows that 72% of homeowners want to make their homes more energy efficient, and 40% reportedly have plans to make improvements before the end of the year.

This week, at The Salary Calculator, we’ll walk you through the following:

• Green tips that can help you cut back on energy usage and save cash
• Some of the top green upgrades, how much they cost and how much they save
• Grants and incentives to assist you access upgrades

Green tips that save cash

You’ll be glad to hear that green upgrades don’t have to cost the earth and small changes can indeed have a huge impact. LED bulbs are one of these small changes. These bulbs are far more energy efficient than halogen bulbs. They last five times longer and use 80% less energy while producing the same amount of light. Aside from this, there are emissions savings to be had. In fact, the Energy Saving Trust found that if everyone made the switch, yearly, 1.7m tons of carbon emissions could be saved!

So what’s the full cost versus savings breakdown?

The upfront costs of a LED light bulb are around £5.40 upfront, and with £19 in energy costs across a 20,000-hour lifetime, this amounts to £24.40. However, research shows you can save £153.40 by upgrading just one bulb to LED.

Weather strips are also a low-cost way of both weatherising your home and saving money. Air leaks in your home can mean that both hot and cold air escape. Some estimates are that you can access between 10-20% annual energy savings. So what’s the initial cost? Just £3. The savings? As much as £669 after five years, according to some estimates.

Smart thermostats, meanwhile, have also been highlighted for their ability to assist in keeping bills low. Once you’ve got a smart thermostat installed, you’ll be able to be in control of your heating – even when you’re not at home, adjusting your home’s climate. Makes like Tado even provide you with monthly bill predictions and room-by-room comparisons. While varying from around £100-£200 for installation, Google’s Nest estimates that people can save up to 16.5% of their energy usage. Tado, meanwhile, says this can go up to 31%.

And, from one smart device to another, smart metres can also help people be greener and get more insight into their energy usage, which, in turn, can help you take action. Research from Smart Energy GB found that if everyone made the switch, savings could go as high as £560 million.

If you want more ideas on green tips, Nationwide recently launched a tool which gives people more insight into how to make their properties greener.

Green upgrades

Beyond small changes like LED lights and weather strips, if you want to make some larger changes, there could be even more savings to be had. Roof installation, for example, magnifies the impact of weatherstripping, helping you reduce both heat loss (up to a 25% reduction) and heating bills. While you’ll spend an average of £550, you could save £2,079 after five years. Not only that, you’ll also shrink your carbon footprint by around 530kg a year.

Double glazing can also be a barrier to heat loss. Estimates are that people in Britain lose between 10- 40 per cent of their heat through their windows. However, double glazing can lead to big savings – up to £235, while reducing your carbon footprint by 6%. Some research has found it can even boost house value. It’s an investment that takes time to pay off, but there will be a payoff. Head over here for a full breakdown.

Rooftop solar panels are another way to make big savings – although there are also some big upfront costs, too. Prices will vary depending on system size and number of panels, but research shows that:

• Installing a 3kW panel system with 12 panels could cost you between £5,000 to £6,000 to set up, but will save you around £850 a year on bills, and after 25 years, around £21,250
• For a 5kW panel system with 20 panels, you’ll be set back between £8,000 and £9,000, saving you £1,460 and up to £39,550 after 25 years.
• If you decide to go bigger than this, with a 6kW panel system that has 24 panels, you’ll pay between ​​£8,000 – £9,000 but save over £1,460 and over £40,325 after 25 years.

Grants and initiatives

These bigger investments in green upgrades can set you back quite a bit, as we have seen, despite their long-term savings.  However, there are grants and initiatives which can assist you in greening your home.

While the Green Homes Grant, which is no longer open to people, might have been deemed a “slam dunk fail” by the Public Accounts Committee (PAC) report, there are other schemes being delivered regionally.

For example, back in March 2023, the government announced that £1.4 billion would go to authorities, providers of social housing and charities to upgrade homes and off-grid households with energy efficiency measures.

Cumberland Council and Westmorland and Furness Council are some of the recipients of funding from the government Home Upgrade Grant Phase 2 (HUG 2) scheme, having been successful in their bid for a minimum of £12.4 million.

The ‘Bright Green Homes’ project across the South West will also see over 500 households in Bristol, North Somerset and Bath & North East Somerset (BANES) receive funding for energy efficiency and renewable upgrades.

Similarly, the Cambridgeshire and Peterborough Combined Authority Consortium secured £82,313,888 in its Home Upgrade Grant Phase 2 funding bid.

A full list, along with eligibility criteria, can be found here. 

Some energy companies also offer free insulation or grants to assist you with making your home more energy efficient, in line with the Energy Company Obligation (ECO) Scheme. Learn more about that here. 

Tags: cost of living crisis, Energy prices, savings, upgrades

Eating healthy when food prices are high 

by Madaline Dunn

Life’s not been too easy on the bank balance as of late. From sky-high rent to eye-watering energy costs, for many, day-to-day living has never felt so expensive. Food prices are, of course, also rising dramatically and, over the last year, have reached record highs.

When food shops are so expensive, it’s understandable that you might feel less able to assemble healthy, nutritious meals. But, at The Salary Calculator, we’re here to help. In this week’s article, we’ll walk you through:

• What’s going on with food price inflation
• Top tips for affordable healthy eating
• How switching to plant-based can save you money, keep you healthy and protect the planet

Food price inflation

According to reports, food prices in the four weeks to May were 17.2% higher than they were a year ago. There are a number of reasons for this, the Russia-Ukraine war impacting energy, high animal feed and fertiliser prices, supply chain issues, extreme weather affecting harvests, and Brexit. While prices have dropped slightly since April, as Fraser McKevitt, the head of retail and consumer insight at Kantar, says, it’s still “incredibly high” and only down 0.1 percentage points.

Currently, inflation in the UK is higher than in other countries, such as Germany, 7.6%, France, 6.9%; and the US, 4.9%. Overall, food prices have risen at twice the rate of overall inflation, with dairy particularly affected, rising three times faster than other items. Four pints of milk, for example, is now 30p higher than this time last year at £1.60, while a 400g block of cheddar cheese is up 39%. But, across the board, groceries are costing more:

• 1 kg of granulated sugar is up 47%,
• 1kg of potatoes is up 28%.
• Olive oil is up 46.4%
• Sauces, condiments, salt, herbs and spices are 33.9%

It’s no wonder then that people are feeling the pinch, and the impact has been wide-reaching, with shoppers trying to make savings wherever they can. Research shows that own-label item purchases have shot up by 15.2 per cent, and more people are also shopping at budget supermarkets like Aldi. Aldi, for example, saw a 24 per cent sales increase, making it the fastest-growing grocer this month, while Lidl’s sales increased by 23.2 per cent.

However, you might be wondering why supermarket prices are still high despite costs coming down. Well, some believe that retailers are trying to make up for their fall in margins last year.

Regardless of why, consumer group Which? has called on the government to undertake its review of food pricing rules as quickly as possible. Rocio Concha, the Which? Director of Policy and Advocacy said: “It’s good news the government has committed to reviewing pricing rules, but this must be undertaken as soon as possible as much clearer pricing is vital in enabling shoppers to compare prices and find the best value products.”

Adding: “Supermarkets should also be making it easier for people by urgently committing to stocking essential budget ranges in all their stores, particularly in areas where people are most in need.”

Tips for healthy eating while prices are high

Considering the above, it’s understandable if you’re struggling to keep your weekly shop costs low, but below, we’ve got some tips for you.

Buy seasonal: Buying seasonally is cheaper because seasonal foods are more easily available in supermarkets and often not imported, which is a big plus from an environmental perspective, too, as it means your food travels fewer food miles. Seasonal food is also often fresher.

So, what’s seasonal? Well, for example, broccoli is seasonal from August to October, leeks from September to March, and cauliflower, from January to April. For fruit, you’ll get apples between September and February, tomatoes from June to October, and rhubarb, from January to June. If you live near to a local farm stand or farmer’s market , this could be a good go-to. For more information about seasonal food, click here, or for recipe inspiration, check this out.

Buy own-brand, “value” or “essential” or “basic” label: Buying supermarket own-brand products can save you a ton of money and these days, more and more supermarkets are coming out with their own value selection, even Co-op, which was a little late to the game. Head over here to review some of the best own-brand products.

Keep your eyes peeled for yellow stickers: While not always helpful for all items, it’s always worth checking out a supermarket’s yellow sticker selection, which features an assortment of reduced items often near to their best before or sell-by date. ​

According to the site SkintDad, the best time to go yellow-sticker-hunting at Tesco is around 8 pm or around 30 minutes before smaller stores close, while at Sainsbury’s, it’s 7 pm, and at Morrison’s, it’s 6 pm.

Freeze your bread: Freezing your bread can make it last a lot longer, for months, even. Plus, freezing bread doesn’t mean compromising on texture or flavour when sealed and thawed correctly.

Meal planning: Meal planning saves both time and money. When you have a plan while shopping, you’ll avoid buying unnecessary groceries, and, plus, you won’t have to step inside a shop during the week, meaning you won’t be tempted to waste money on things you don’t need.

Make your own sauces & soups: It might be tempting when you’re feeling lazy to buy a tomato sauce rather than make one yourself but making sauces from scratch can be a lot cheaper, plus you can make them in bulk and freeze them. The same goes for soups and dressings.

Saving pennies with plant-based power

Plant-based diets have really become popular in recent years for a number of reasons, including as part of a vegan lifestyle, informed by concerns for animal welfare and the planet’s health. Learn more about that here and here. Alongside these benefits, going plant-based can actually be a lot cheaper, too. Especially considering that inflation has hit meat and animal products nearly twice the rate of vegetables.

There’s a misconception that plant-based diets are expensive, and while that might apply to some vegan alternatives, such as processed plant-based meats and cheeses, eating whole foods can save you a pretty penny while still being delicious and packed full of flavour, whether that’s beans, lentils, tofu, or tempeh.

Research by Oxford University, for example, found that those following a vegan diet could reduce grocery bills by as much as 34 per cent compared to the costs associated with a typical Western diet.

Where many people struggle with vegan diets is missing cheese. Vegan cheese company Violife found that it’s the main reason holding around 45% of people back from making the switch. It’s not surprising, either, considering that cheese contains large amounts of protein casein, which triggers the same part of the brain as hard drugs!

However, this is where nutritional yeast flakes come in, or Nooch, as they’re more appetisingly known. These cheesy-flavoured flakes are high in B12, zinc and protein and can be sprinkled over plant-based meals to satisfy your cravings for a cheesy hit and in a more nutritionally balanced way.

For some recipe ideas, check out the following links:

• Ela Vegan 
• The Vegan Society 
• Veganuary 
• Vegan Food & Living 

Tags: cost of living crisis, Economy, food prices, shopping

Missing rent and mortgage payments: What’s happening, and where can you find help?

by Madaline Dunn

There’s no denying that times are tough right now, and for many, it feels difficult to find respite. The cost of living crisis is squeezing everyone and from seemingly every angle.

According to Citizens Advice, it has been supporting more people than ever before with aid and referrals. The charity called it the “bleakest ever” start to the year and has facilitated 94,000 people with food bank referrals and access to emergency charitable grants. That’s a 178 per cent increase from the same period in 2020.

Figures show that in the first four months of 2023, it helped more people than the entirety of 2019.

Further to this, recent data from Which? revealed that hundreds of thousands of people across the UK missed payments on household bills in April.

At The Salary Calculator, we understand that it’s a challenging time and that many are looking for guidance on where to turn, so in this week’s article, we’ll walk you through the following:

• The scale of the rent and mortgage payment issue
• How people are responding to tightened finances
• How to form a plan of action and where you can find support

700,000 missed household bills in April

Which? estimates from April reveal a deeply concerning trend of financial strain across the country. The consumer choice and advice company shared that according to its estimates, in April, 700,000 people across the country missed rent and mortgage payments.

These estimates were made by combining the company’s survey data with the data from the Office for National Statistics (ONS). Specifically, it was found that renters, in particular, defaulted on rent payments, with one in 20 (5.2%) unable to pay their monthly rent to their landlord. Comparatively, 3.1% of mortgage holders missed payments.

More broadly, two million households (7.3%) missed or defaulted on at least one mortgage payment, rent payment, loan, credit card, or bill.

The situation is being informed by a number of factors, but crucially, as outlined by Which? Mortgages have jumped significantly. Last year, the average two-year fix in April 2022 was 2.86%, in April 2023, it was 5.35% – meaning remortgaging will be leaving thousands with much more expensive monthly bills. For many renters, this is being passed down from landlords, with one in five tenants in privately rented properties seeing monthly rent prices hiked by 10% or more between February last year and February 2023. This is occurring alongside food prices rising at their fastest pace ever, and sky-high energy bills.

Making more financial adjustments

To cope with the financial blows of the cost of living crisis, millions are having to rethink their finances and make adjustments and cutbacks. According to Which? around six in 10 people have had to make “at least one” financial adjustment in order to be able to afford essentials.

Which? shared that this covered everything from selling their possessions to dipping into savings. This comes to an estimated 16.6 million households across the country – a figure 35% higher than two years ago.

These figures are supported by data from Barclays, which found that increasing household bills has led to half (54%) of consumers cutting back on discretionary spending. Likewise, in order to save, people have been switching from nights out and restaurant meals to nights in, with research from KPMG finding that 63 per cent of people have been cutting back by making fewer trips to restaurants. More nights in have also led to an increase in spending on subscription services such as Netflix and NowTV.

Forming a plan of action for rent and mortgage payments

With mounting bills and pressure from lenders and landlords, it’s understandable that you might be feeling stressed – and while people deal with stress in different ways, the temptation to try and avoid the issue is often strong. Many also shoulder a lot of the stress alone. In fact, according to research by Lowell Financial, a whopping 69% of people who are in debt don’t talk about it with anyone.

But however tempting that might be, when it comes to rent and mortgage payments, it’s important to deal with the situation head-on.

With rent, while it’s always a top priority to put enough money aside to pay your landlord or letting agent, it’s not always possible. After all, right now, rent prices are increasing at their fastest rate in 13 years. But, you must act straight away.

It’s also important to remember that a landlord can start the eviction process straight away, and if you’ve previously missed or been late on payments, you’re already in arrears or you’ve come to the end of your fixed term period.

Citizens Advice also recommends that you reach out immediately if you’ve not paid rent for eight weeks or more, your landlord has initiated court procedures to have you evicted, you’ve received court papers, or you’re expecting bailiffs.

An important point of action is to assess your finances and see how much you can realistically pay, even if it’s not the full amount. Then, initiate a conversation with your landlord and propose these terms. It’s key to see what you’re entitled to and see if you can apply for Discretionary housing payments (DHPs) or certain benefits. You should also be aware that landlords can ask to make deductions from your benefits.

Below are some key contacts to reach out to when dealing with rent arrears:

• MoneyHelper
• Shelter
• Citizens Advice

If you’re having difficulty paying your mortgage or are in arrears, while lenders typically wait around 15 days after a missed payment to reach out, you should reach out straight away. However, prior to doing that, as with rent arrears, it’s important to calculate a budget of what you can afford to pay, which you can share when you contact them. If this feels difficult, speak to an adviser at your nearest Citizens Advice.

It’s also important to be honest, and assess whether or not the situation is likely to be temporary or long-term. If the former, they may suggest making a temporary payment arrangement or an interest-only mortgage – find out more about that here.

If the situation is not looking like it will be temporary, there are other routes you can take. For example, you may be eligible for certain benefits or Support for Mortgage Interest (SMI) and be sure to look into mortgage rescue schemes, for example, the Breathing Space scheme.

 

Tags: bills, cost of living crisis, Economy, Mortgages, rent

Guidance for university students during the cost of living crisis

by Madaline Dunn

As the UK enters a recession, inflation rises, and the cost of living soars, times are tough, and research shows that students in higher education are increasingly feeling the pinch. Research from Unite shows that around two-thirds of students are now worried about the increased cost of living, and more and more are either considering or proceeding with dropping out.

Recently, a Department for Education (DoE) spokesperson said that it is responding to the crisis by increasing the amount students can access through loans and grants for living and other costs and cited the work of universities in this area. However, many students and those working within education argue that more help is needed and are pushing for more resources to become nationally available. The UUK, a collective of 140 universities, has specifically called on the government to do more to help universities support students.

At The Salary Calculator, we understand how stressful it can be trying to juggle education and financing your day-to-day, so, below we’ll explore:

• Some of the context around student finances right now
• The financial support and advice currently available and how to access it
• Tips to help you stretch your loans and grants

The rise in students struggling with the cost of living crisis

There are no two ways about it, students are really feeling the brunt of the cost of living crisis, and the implications are far-reaching. Working-class students are already underrepresented within higher education, and the current crisis threatens to widen the gap. Figures from the Student Loans Company in September reveal that almost 40,000 students in England, Wales and Northern Ireland permanently withdrew from their courses and stopped receiving student loans by the end of August.

It’s no wonder so many are finding university to be financially unviable, with a recent survey published in July finding that 11% of students were using food banks, with one-third having to rely on credit cards to survive. Moreover, while working to support one’s studies is nothing new, studies show that students are being forced to work far beyond the recommended 15 hours a week, with 9% of students working 21-30 hours a week and 11% working over 31 hours. Moreover, Unite has outlined that around one-third of students are having to increase their working hours just to stay afloat.

What financial support is available and how can you access it?

On the 11th of January 2023, the government announced that it would provide an additional £15 million in hardship funding this financial year to enable universities to better support students facing financial strain. Likewise, the government outlined that loans and grants supporting undergraduate and postgraduate students will be increased by 2.8% for the 2023/24 academic year, while university tuition fees will remain frozen at £9,250 for the next two years.

In addition to this, the 24 Russell Group universities recently announced a pledge to inject tens of millions more in financial support to help students with the rising cost of living, and match the UKRI uplift to its minimum 2022-23 postgraduate research stipends.

But, what does this mean in real terms? Well, if you’re struggling with finances at university, you may be eligible to access your university’s hardship fund. Eligibility is dependent on a number of factors, which we’ve outlined below:

• You’re a student with children or a single parent,
• You’re a student from a low-income family,
• You’re a student that is a ‘care leaver’,
• You’re a mature student with existing financial commitments ,
• You have a disability,
• You are homeless or living in a foyer.

Find out more about accessibility to hardship funds here.

There are other measures being brought in by universities, and these offerings vary from institution to institution. Durham, for example, is offering students free breakfasts while eligible households at York are being offered help with energy bills. The University of Wales Trinity St David (UWTSD) is offering meal deals for students in the university canteen, for example, soup and a roll for £1, and a food hub offering items for free for students or staff who need help with “no questions asked.”

Alongside hardship funds and student finance, you should check to see whether you’re eligible for other forms of scholarships, bursaries and grants. Scholarships are available to high achievers but are also awarded based on gender, ethnicity, background and disability. In the case of the latter, there is the Disabled Students’ Allowance. You can also get a scholarship for:

• Being vegetarian or vegan via The Vegetarian Charity’s grant,
• Being talented at eSports at the University of Roehampton,
• Studying Welsh through the Coleg Cymraeg Cenedlaethol scholarship.

To read more about the different loans, grants, bursaries and scholarships available, head over here.

Tips for stretching loans and grants

Once you’ve managed to access the grants, loans and scholarships you’re eligible for, you may find that you’re still struggling with your finances, and in this case, below, we’ve outlined some helpful tips to help you stretch your money a little further.

Groceries are undeniably expensive right now, so making savings where you can is helpful. Luckily there are a number of sites that offer either reduced or free food. Both ​​Olio, and Too Good To Go, are good zero-waste apps to check out. Likewise, check to see if there are any food waste supermarkets in your area. You can also check what food banks are available to you locally by searching on the Trussell Trust’s website.

When it comes to planning your week and making sure you keep costs as low as possible, meal plans can be really helpful. This way, when you go out to your food shop, you have a clear idea of what you need to buy and how much it’ll cost, saving you a lot of hassle and money.

Another tip for finding cash when things are tight is to look into selling items that you don’t use or need anymore. Sometimes we can surprise ourselves with the amount of stuff we have that’s just gathering dust. Facebook Marketplace, eBay, Gumtree, Depop, and Vinted are some of the most popular sites for doing this.

It could also be beneficial to look into switching to a better student bank account because there are lots that offer lots of extras, such as free cash and railcards (which definitely can’t hurt if you’ve seen the price of train tickets recently). Money Saving Expert is a good site to check out if you’re looking to compare and contrast. Likewise, using a student bank account often means you’ll have access to a 0% overdraft, and this can act as a buffer when things get tough.

That said, it can be easy to slide into debt when money is tight. With around 27% now using credit cards to help with student life, there’s always a risk of not being able to pay back what you’ve taken out and that can come with a lot of stress. Don’t face this alone. There are a number of debt advice charities out there that can help, including:

• StepChange,
• National Debtline,
• Debt Advice Foundation.

Tags: cost of living crisis, debt, Financial aid, student finance, student loan

Pensions in the current climate

by Madaline Dunn

Recently, there have been lots of government budget announcements and a number of changes made in regard to pensions. These changes come alongside discussions around potential alternations to pensions in the future. With such a raft of changes, it can be difficult to know where you stand or how exactly you’ll be affected.

At The Salary Calculator, we’ll walk you through all the information you need to understand pensions in the current financial climate in a straightforward way. We’ll cover the following:

• The triple lock and discussions around its replacement
• The increase the state pension
• The pension age increase
• Upcoming changes to tax payments for retirees

The triple lock

The triple lock was a pledge made by the Conservatives in their 2019 manifesto but was broken over the pandemic. Now, despite doubts, it has been reinstated under the new budget. It ensures that pensions increase in line with either:

• The average wage increase,
• Inflation, or
• 2.5%

As such, there will be a 10.1% increase in State Pensions from April 2023.

According to experts, the government has considered scrapping it altogether and replacing it with a new system following the next election. Some commentators have also forecast that, in the future, state pension entitlement could eventually become means-tested, a model that is currently present in Australia. A means-tested pension top-up was also proposed by former Chancellor Gordon Brown back in 2002.

This kind of means-tested pension is not without its critics, though, and with recent whisperings of this kind of model being proposed, former Pensions Minister Baroness Ros Altmann claimed it would be “disastrous.” Altmann, for example, outlined: “Without a decent basic state pension underpin for everyone, the real risk is that more pensioners will end up poor in retirement and this will damage long term growth for us all.”

The increase in the state pension

As per the triple lock, pensions will rise in line with September’s Consumer Prices Index (CPI) measure of inflation. So,

From April 2023, payments will be as follows:

• £203.85 a week, up from £185.15 for the full, new flat-rate state pension (for those who reached state pension age after April 2016).
• £156.20 a week, up from £141.85 for the full, old basic state pension (for those who reached state pension age before April 2016).

Increasing the pension age

The UK is currently in a recession, and the Treasury is frantically searching for ways to raise money. One of the proposals that would reportedly raise billions is increasing the pension age. As per current legislation, the retirement age is to rise to 67 by 2028. By 2039, this is set to increase further to 68. However, ministers are pushing to increase the pension age to 68 by up to six years earlier in 2033.

Some experts say that if this goes ahead, those who are currently in their 50s will receive £10,000 less when they retire.

New Work and Pensions Secretary Mel Stride has now confirmed that the outcome of the State Pension age review will be published before May 2023 – so a final decision is coming soon. Stride was recently grilled on potential upcoming changes to pensions in the Spring budget. When asked whether or not the portion of people’s lives spent in retirement should shrink (currently at one-third), he said he couldn’t be drawn on what his thoughts are “at this stage” and questioned whether John Cridland’s (who led a previous review of the state pension age in 2017) was right in his calculation of one-third.

WASPI – Women Against State Pension Inequality, meanwhile, has called for the government to introduce fairer policies. Jane Cowley, director of Waspi, for example, said that the government needs to “look less at average figures” and “take greater account of the lives of people in economically disadvantaged areas.” She added: “Often in these areas there is a drastically lower life expectancy and very few years spent in good health during retirement.”

Likewise, Angela Madden, chair of Waspi, said: “Ministers need to recognise that while we are living longer, people in their late 60s and early 70s tend to be in declining health.” Adding: “It isn’t right to expect everyone to work full-time till they drop.”

Upcoming changes to tax payments for retirees

According to reports, if the UK Government increases State Pensions by 10.1% next April, although 12.5 million people would see a boost, another 500,000 could be included in the “tax net.”

Former Liberal Democrat pensions minister and partner at pensions specialists LCP (Lane Clark & Peacock), Sir Steve Webb, explained that this is because of the freeze on tax thresholds, coupled with the increase in pensions.

Elaborating on this, Nimesh Shah, the chief executive of Blick Rothenberg, on the BBC Money Box podcast, called this a tax increase “by the back door.” He continued: “Everyone uses the word stealth tax increase. They didn’t want to increase the headline rate in the run-up to the next general election.” Shah said that this is an example of the fiscal drag effect: “Someone’s wages go up but they are paying more income tax because of those frozen allowances. The state pension is increasing by 10 percent which is great news but pensions are now going to get dragged into income tax.”

 

Tags: cost of living crisis, pension, pension age, retirement, state pension