Four big money changes hitting in May including Universal Credit and benefits shake up – are you affected?
MILLIONS of people have already seen their finances take a hit after major bill rises in April.
And there are more changes to come in May - but with some you could be better off, or find ways to save cash.
Here we explain what's happening and when, as well as what it means for your money.
Interest rate rise
Millions of homeowners could see mortgage payments rise if the Bank of England (BoE) puts up interest rates again
The BoE monetary policy could announce a rate hike after it meets on May 5.
The central bank hiked the base rate to 0.75% in March and experts believe there will be further increases this year.
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The base rate is used by banks to set interest rates for mortgages and savings.
Homeowners currently on a standard variable rate (SVR) are likely to see repayments rise if the BoE increases rates - and it could cost hundreds of pounds more.
Your lender must give you warning if it increases the SVR, and you can look around for a fixed deal to avoid the hike and potentially save money.
Anyone on a fixed mortgage deal already won't see a change straight away in repayments as they have locked in their current rates for a set period of time.
But they could see higher rates when they come to the end of the term, either when shopping for a new fixed deal or reverting to the SVR.
If you're nearing the end of a fixed deal it's worth looking now as you can lock in current deals sometimes up to six months before your deal ends.
Leaving a fixed deal early will usually come with an early exit fee.
You could also save cash on your mortgage if your loan to value ratio, credit score or salary change, as this could give you access to better rates.
Here's how to get the best deal on your mortgage.
Meanwhile anyone with money on the bank could find they get better interest rates on their savings.
Banks are often slower to pass on a base rate rise to savers, but recently Chase launched increased interest on its easy access accounts to 1.5%.
And First Direct has put up it it's regular saver account interest rate to 3.5% while Charter Savings Bank is offering 2.5% on a three year fix.
Universal Credit and benefits shake up
Millions of people on legacy benefits are expected to start being moved over to Universal Credit.
The government has a goal of the end 2024 to get everyone over to the new benefit from six older ones.
So-called managed migration is starting up again from May 9 after a pause during Covid, starting with a small number of claimants the government has confirmed.
Those potentially affected are on the following benefits:
- Working Tax Credit
- Child Tax Credit
- Income-based Jobseeker’s Allowance
- Income Support
- Income-related Employment and Support Allowance
- Housing Benefit.
You can be moved over to Universal Credit already if you have a change in circumstances, like moving home, a change in working hours or having a baby.
And if you're on any of these benefits now, you can chose to move over - but you might not be better off.
You should consider carefully what moving over means for your money, as you can't move back once you're on Universal Credit.
Those who don't move over under these circumstances between now and December 2024 will eventually switch under managed migration.
Council tax rebate £150 payments
Millions of households are set to get a £150 payment into their bank account to help with the rising cost of energy bills.
The council tax rebate was first announced in February by the government to help tackled the cost of living crisis.
Payments started from April 1 but many councils have had to wait to process payments, meaning many will come through in May instead.
Around four in five households in England in council tax bands A to D are eligible for the cash.
Many councils have waited for households to make their first bill payments of the new tax year in April, to confirm that a household is eligible.
Payments are being made automatically if you pay your council tax bill by direct debit.
If you don't have this set up then you may have to apply - and this could mean a longer wait for the cash.
A separate £144million fund has also been launched which local councils can dish out to vulnerable and low income households.
Some councils like Camden have opened applications for the cash worth up to £150.
You can find out which band you're in to see if you're eligible for the automatic scheme, or need to apply to the fund by using - you just need to enter your postcode.
Sky price increases
Sky is putting up phone prices from today (May 1) for landline customers.
The cost of making a call with Sky Talk on a home phone is going up by 10% from May 1.
You'll now pay 22p per minute to talk to friends and family, up from 20p.
The increase applies to calls made to mobiles and other home phones in the UK.
How much more you'll pay overall for using your landline will depend on the tariff you have and your usage.
For instance with Sky Pay As You Talk all calls will cost you 22p per minute, regardless of the time, or day of the week.
But with Sky Talk Anytime Extra you pay a flat fee and can make unlimited calls at any day or time.
Other charges like line rental and flat fees for inclusive calls are not affected.
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Sky will also bring back EU roaming charges from May 3, adding a cost of £2 per day to holidaymakers bills for using mobile data, making calls and texts like you do in the UK.
You could get a better deal on your home phone, broadband or mobile bill by searching for a better deal or haggling - here's how.
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