Spring Statement 2025

The Chancellor’s Spring Statement has dropped, and while it didn’t bring any big fireworks, there are a few updates worth knowing about – especially if you’re thinking about your Savings, Investments, or long-term planning.

No major tax changes – but eyes on Autumn

First things first: no new changes to Income Tax, Capital Gains Tax, or Pension allowances this time around. The government’s playing it safe for now, likely keeping their powder dry for the Autumn Budget later this year.

Economic outlook – slow and steady

Growth is now forecast at just 1% for 2025, and inflation is expected to drop from 2.8% this year to around 2.1% by 2026. That’s heading in the right direction, which could be good news for interest rates, borrowing costs, and longer-term Investment returns.

Crackdown on tax avoidance

The government’s also turning up the heat on Tax evasion and avoidance, aiming to bring in an extra £2.2 billion. It’s a reminder to keep your planning avoidant and not evasive – there’s a big difference.

The bottom line?

There was no big news, but there are likely to be bigger moves in the Autumn Statement, and Reeves seems determined to shake up the ISA regime, so bring on the Autumn.

It’s up, and then it’s down

You might’ve spotted the headlines – UK inflation dropped more than expected in February, now sitting at 2.8%. That’s down from 3% in January and a big step in the right direction after the highs we’ve seen over the past couple of years.

The main reason? Clothing and footwear prices took a dip, thanks to an unusual number of sales sticking around longer than usual this year. It might not sound like a big deal, but these changes all feed into the wider inflation picture.

So, what does this mean for your Finances?

In short, falling inflation means the cost of everyday goods and services isn’t rising as fast – which is good news for your spending power. But we’re not out of the woods just yet. The rate is still above the Bank of England’s 2% target, and price hikes are still expected in areas like council tax, utilities, and wages from April.

This means the Bank of England is likely to keep interest rates where they are for now, with a possible cut later in the year if inflation continues to ease. For savers and investors, it’s a bit of a waiting game – but it’s positive to see things moving in the right direction.

State Pension boost set to outpace inflation

Good news for pensioners – the State Pension is getting a pay rise! From 6 April, it’s gone up by 4.1%, which is more than the latest inflation figure of 2.8% (as announced by the Office for National Statistics). That means your money should stretch a little further this year.

This year’s increase comes thanks to the triple lock – a government guarantee that the State Pension will rise each year by whichever is highest: earnings growth, inflation, or 2.5%. For 2025, the 4.1% increase is based on the growth in earnings rather than inflation.

So, what does this mean in pounds and pence? If you’re receiving the full new State Pension, you’ll get an extra £9.10 a week – that’s £230.30 per week total, or £11,975.60 a year. For those on the basic State Pension (typically those who reached Pension age before 6 April 2016), the weekly rate will rise by £6.95 to £176.45 – or £9,175.40 a year.

That said, not all parts of the State Pension go up by the same amount. Earnings-related elements (like SERPS or those who’ve topped up via National Insurance) will only increase by 1.7%, in line with last September’s inflation figure.

While this year’s rise isn’t quite as dramatic as the 10.1% we saw in April 2023, it’s still a welcome boost – and a timely one, too, with many people still feeling the pinch of rising prices.

Divorced? Don’t forget to exclude your ex

Divorce is never easy – emotionally or financially. But did you know one in ten people forget to remove their ex as the beneficiary of their life insurance policy? That’s over 800,000 people potentially leaving a payout to someone they’re no longer with.

And it doesn’t stop there. Only 7% of people discuss life insurance during the divorce process, and less than a third have cancelled joint policies after separating. Even fewer think about critical illness or income protection policies post-divorce – just 4% and 3%, respectively.

Wills are another area that get overlooked – 11% of people admit they’ve either forgotten or delayed removing their ex from their will. That means if something happened, their former spouse could inherit everything.

The truth is, only 7% of people going through a divorce speak to a financial adviser – and that’s a real missed opportunity. A good Planning Team can help you take stock, update your paperwork, and make sure everything reflects your new circumstances.

Life changes? Let’s make sure your wishes still match. If you’ve recently gone through a breakup, started a new relationship, or had a major life event, it’s a good time to review your death-in-service, pension trust wishes, or nominated beneficiaries. Even if we’ve discussed this at your last planning meeting, it’s worth a check. Contact us on 02920 450 143 or send us an email via [email protected] to book in a chat with us – we’re here to help.