Article by Phil
Hargreaves Lansdown have revealed their top Financial Planning tips and predictions for 2023 in the latest article in the FT Adviser. We though it might be worth repeating them for you. Some of these did not need a crystal ball!
These are their Financial Planning tips not ours of course.
- Inflation will remain high. How high we don’t know but the Bank of England predicts 5% by the end of the year.
- You’re going to pay more tax. As a result of the tax thresholds remaining frozen, more people will fall into higher tax bands.
- Energy prices will remain high. They may come down, but they will still be unpredictable.
- Energy price will also rise. As a result of the Energy Price Guarantee ending in April. Average bills are expected to hit £3,000.
- Mortgage Interest rates may come down. We have already started to see this filtering in as markets have stabilised. Lower inflation should also reduce rates.
- Savings rates will fall. Sadly, if inflation falls and interest rates come down, so will rates on savings. They will probably also come down much quicker than they went up as well.
- There will be a downturn in the housing market. Another knock effect of higher bills and interest rates is that many people will not be able to buy houses. This may also bring down house prices.
- Unemployment is likely to rise. Although their prediction is for a small increase.
- The Pension Triple Lock is under pressure. After the double digit increase this year there is no doubt that the government will be under pressure to constrain future increases. Especially with the current wage pressures across the public sector leading to unpopular industrial disputes.
- The State Pension age may increase. The age is already increasing to 67 in 2023 and there are suggestions the next increase to 68 may be brought forward from the scheduled date of 2046.
Let’s see how many of these Financial Planning tips come true over the course of the year. Not many of them provide a particularly bright outlook. Remember, these come from the Hargreaves Lansdown team, not us.
