Summer 23 – money roundup

There are a number of things happening over the summer that could impact your wallet. Here’s our round-up.

Disability cost-of-living payments

Six million people are due to receive the £150 disability cost-of-living payment.  If you’re eligible, it’ll be paid directly into your bank account. You can expect payments from now until 4 July.

To get the money, you must be receiving a benefit from the following list:

• disability living allowance
• personal independence payment
• attendance allowance
• Scottish disability benefits (adult disability payment and child disability payment)
• armed forces independence payment
• constant attendance allowance
• war pension mobility supplement

There’s a long list of relatively common medical conditions that might mean you qualify for disability benefits, including:

• skin conditions that inhibit your everyday life
• eye problems, such as low vision
• migraines
• Tourette’s syndrome
• writer’s cramp
• anxiety
• panic attacks
• asthma
• depression
• obsessive compulsive disorder

There are also some little-known conditions that might mean you’re eligible. These include:

• multiple allergy syndrome
• frailty
• asthma
• chronic fatigue syndrome
• skin disease
• alcohol and drug addiction
• back pain

Try our free benefits calculator to find out if you could be claiming any other benefits.

Interest rates rise (again!)

Last week, the Bank of England announced the 13^th interest rate rise in a row.  The rate has increased from 4.5% to 5%.  This will lead to higher repayments on some loans and mortgages.

Example of the effect on mortgages

If you borrowed £100k over 35 years at an interest rate of 2%, your repayments would have been £331. An increase to 4% would see your monthly repayments rise £112 to £443. An increase to 6% would result in your repayments rising £239 to £570.

If you’re on a tracker mortgage the interest you’re paying follows the base rate. This means your repayments will go up.

If you can afford to, moving to a fixed-rate mortgage would give you certainty over your repayments. It would also protect you from any future hikes in the base rate.

Government agrees support with lenders

The government has urged people struggling to pay their mortgage to speak to their lender about their options. They reassured people that this wouldn’t affect their credit score.

They also announced that anyone who increases the length of their mortgage or moves onto an interest-only plan will be able to reverse the change within six months without it affecting their credit rating.

But they haven’t unveiled any support for people who rent. This is a concern for tenants worried landlords will increase their rent or sell their homes to combat rising mortgage costs.

Energy prices fall in July

The annual energy bill for the average household will fall from £2,500 to £2,074 in July.

But this £426 reduction will be effectively be wiped out, as we won’t be getting the £66-£67 monthly reduction over the winter.

Universal credit childcare payment

If you’re a parent on universal credit you currently have to pay your childcare costs up front. This may mean you have to find £1000s in nursery fees before getting any support.  You can then claim back 85% of the cost. 

From 28 June, all payments will be made up front.  The maximum amount you can claim will increase from: 

Number of children	From	To
1	£646	£951
2	£1108	£1630

The government will also help eligible parents cover the first month’s childcare when they start work or significantly increase their hours.

We’re here to help

If you’re struggling due to the rising cost of living, get in touch to find out how we can help.