UK Autumn Budget 2024: Key Points

The UK Autumn Budget: What it Means for Your Finances as a Single Person

Earlier this month, we shared our  thoughts on the impending impact the UK autumn budget might have on single people (and their finances). If you’re like me, you were waiting for Rachel Reeves announcement at the end of October with a mixture of nerves and impending dread.

The good news? The budget isn’t all bad. Just like the Spring Budget, there are positive and negative points worth addressing. The bad news – the Government still seems to be looking the other way,  overlooking the millions of single people who desperately need support throughout the country.

Reeves pledged an era of “national renewal” with “more pounds in people’s pocket” with this budget – but it remains to be seen what that really means.

If you’re still feeling confused about what the latest budget will actually mean for you as a single person – here’s what you need to know.

WHAT’S CHANGING

The Minimum Wage is Increasing

If you’re a single person that’s currently working, and you’re classed as a low earner, you’re likely to benefit. The national minimum wage is going to be increased by 6.7% in April 2025. Employers will bear the brunt of the increase, needing to pay workers over the age of 21, £12.21 an hour.

Essentially, this means if you’re working an average 35-hour week, you can expect to earn about £22,222 per year. Workers under the age of 21 (18-20) will also see their wages increased to £10 per hour – giving them an extra £2,500 per year on a full-time income.

Still, you should be better off as result. The rise on minimum wage will also have an impact on pension contributions. For instance, if you’re earning £12.21 per hour, and you’re enrolled in a pension scheme, you’ll benefit from £112 more in contributions per year from your employer.

The slightly worrying side of all this is that some employers are saying that people might have less of a chance to get a pay rise, or even a new job simply because of the additional burden they’re going to face paying higher wages (and bigger National Insurance Contributions)

Other Benefits are Increasing Too (Even for Single People)

Some of the other “state benefits” we have access to in the UK are primarily linked to inflation. The recent drop in the cost of living means that by April 2025, some benefits will be increasing by around 1.7%. That’s not huge – but it’s something.

Changes to Universal Credit will likely have the biggest impact on most single people. The standard allowance for a single person over the age of 25 is currently around £393.45 a month, and this will go up by around £6.69. If you’re in a couple, however, you will get a bigger benefit of around £617.60.

Another bit of good news is that carers will also be able to earn more before they lose their allowance in 2025. The government will be increasing the maximum earnings threshold from £151 to £195 per week. So, if you’re a single person looking after a relative, or loved one, you’ll be better off.

State Pensions are Increasing (But There’ll Be More Tax)

First, the chancellor confirmed a “triple lock on pensions” will mean you can expect a 4.1% increase to your state pension from April 2025. In other words, you can look forward to around £230.25 per week, instead of £220.20 per week. As mentioned in our previous blog this is good news for single people of all ages – not just those currently thinking about retirement.

The typical minimum guarantee for single people receiving pensions is also increasing from £218.15 per week to £227.10 per week too. So, anyone earning less than £11,809 per year will be eligible for pension credit. That’s pretty crucial now that the winter fuel allowance will only be paid to people who have pension credit – even if you’re struggling to pay for your heating.

The bad news? Inheritance tax is changing. Right now, you can essentially leave your unspent pension fund to anybody without requiring them to pay IHT. However, from April 2027, you’ll only be able to leave the money to a spouse or civil partner without paying the tax. If you leave it to anyone else – then they might have to pay.

If the government didn’t want to give people, the impression that they’re prioritising “couples” over single people – this was probably a bad move.

Travel Shouldn’t Become (Much) More Expensive

Finding money to actually travel as a single person when you’re dealing with just one income can be difficult – trust me, I know. There are already plenty of challenges to overcome, like the issue of “single supplements” charged by various travel companies. You can find some more advice on how to reduce your travel costs here, if you’re struggling.

An increase in fuel costs would undoubtedly make traveling more expensive – whether you’re driving, or using public transport. Fortunately, the Chancellor announced that the freeze on fuel duty previously introduced by the government will stay the same.

If this freeze hadn’t continued, petrol would have gone up by around 7p a litre, which would have had an impact on all kinds of travel. Plus, Reeves is actually investing some government money into various travel opportunities, like upgrading the Trans Pennine route, and repairing roads and potholes.

On the downside, travelling by bus might end up costing you more, as the single bus fare cap to many routes in England will be raised by 50%, from £2 to £3 in 2025.

The Continued Housing Issue

As I mentioned in my previous article about the Autumn budget, buying or renting a home isn’t easy – regardless of whether you’re single or not. Getting on the housing ladder is definitely a lot tougher for single people most of the time – however.

First, the good news is that there are definitely no plans to scrap the council tax discount for single people – despite all the worry they made single households endure earlier this year. Secondly, we now know that the government is planning to spend around £5 billion on building new houses in 2025 and 2026, to increase the supply of “affordable” housing for everyone (in theory).

The trouble is, the government is also planning on reducing right-to-buy discounts, which means if you wanted to purchase a council house you’ve been living in for a lower rate, you might struggle in the years ahead. Apparently local governments are going to be retaining the earnings from council housing sales, so they can re-invest in new properties.

That’s not ideal for us single people. Plus, since stamp duty on the purchase of second homes is going increase in 2025, which could affect landlords willingness to buy more properties. It could also mean that you end up paying a lot more for your rent in the years to come. That’s a big blow for single people, who are generally more likely to rent than buy.

The Warm Homes Plan and Energy Bills

If the ever-rising energy bills have caused a serious issue for you in the last couple of years (like most single people), the Autumn budget did reveal some updates. First, the government is going to be taking the first steps towards its warm homes plan.

This basically means they’re investing £3.4 billion over the next three years in the development of homes that are more efficient, and the switch to low-carbon technologies. Around £1.8 billion of this fund will go towards fuel poverty schemes. Ultimately, this could help around 225,000 low-income households lower their energy bills by around £200 per year.

The government has also increased funding for the Boiler Upgrade Scheme in England and Wales, and they’re providing funding to heat pump manufacturers to help facilitate the new demand.

Still, although the government is aiming to lift 1 million homes out of fuel poverty, there’s a good chance energy bills are going to stay pretty high overall. The energy cap rose by 10% in October this year, and some experts still predict that the price cap will increase again between January and April 2025.