Is Anyone preparing/hunkering down for 'after the budget'

[IsUnemploymentRising]

The news is today seems to be full of headlines such as unemployment is going up, housing markets are softening, budget is make or break.

Lots of people such as Andrew Bailey quoting things like markets could crash due to debt and AI bubble etc

I just don't see how RR or anyone else for that matter can get us out of our current situation without considerable cutbacks and pain.

Raise Taxes - lots of people think this is maxed out now with rich leaving and businesses already hit (thus rising unemployment)

Cut Benefits - will they try this again. If so what will all the people on benefits actually do to live. Will they all get jobs. Is there jobs?

So are you hunkering down?

Me personally I wish they would just get on with it. I hope to move house in next few years and whilst I'm still committed to it I can see another frozen housing market coming where only forced sellers sell and everyone else sits tight.

I'm retired (although not getting any pensions yet as too young) and definately worried about pension values (ie stock markets, bonds etc). It's very difficult to plan when your pensions are dependant on things outwith your control. (not applicable to those with final salary/defined benefit schemes of course)

State pension is a good 14 years away for me (I'm fully paid up) but I worry it will be eroded when I have built it into my calculations for retirement not to mention the freezing of tax brackets which means we are all getting taxed more each year by stealth.

I'm probably in a better position that many to weather the storm as no mortgage or debts and holding cash etc but even then I worry about our currency being worth nothing soon if they go down the route of printing money again.

Am I being overly pesimestic. I mean how are they actually going to get us out of this. For those on benefits (apart from worrying, being scared etc) how will you actually cope if your benefits are cut.

The majority of the ones doing that are the ones who aren't supposed to be here. Either illegals or ones that have just become illegal by way of letting their visa expire.

Otherwise cash in hand is useful simply because the government can't trace it. If I can, I pay all contractors I hire cash in hand so the taxman can't get hold of it. It's not fraud, it's making sure money gets into the right hands.

It's worth remembering that we have more "media" outlets that ever before - websites, podcasts - so everyone is trying to compete for your attention rather than give you accurate information. They know that you will click "markets due to crash!" I'm not saying things are amazingly stable, but I saw a BBC economics journalist speak a few weeks ago and she actually suggested things were more stable than I'd imagined which was interesting. Wages have cooled slightly, unemployment has gone up slightly (on figures the ONS themselves say to treat with caution); historically, unemployment is still low.

OP, you have enough savings and investments to live for 14 years before touching a pension. And you're directing more income into those pensions. Any impact of the market on those pension funds is likely to have dissipated long before you draw them (investors who stayed in after the 1929 great depression probably recouped losses in 10 years, some say even shorter; the post 2020 covid crash recovered in 5 months). Are you sure you haven't got a bit too much time on your hands to worry about things?

@EasternStandard the address was from another poster, but the OP didn't understand the reference, so I was pointing it out.

I agree. Hopeless, incompetent and lazy politicians just feathering their own nests and leaving the mess and chaos for others to sort out in years to come. It's what we've suffered for 2/3 decades now and no sign of it getting better. None of our current political leaders show any ability at all to get us out of this mess.

As you see, lazy can kicking back in 2008, and the same in 2021 as we came out of covid. Both were ideal opportunities to make some hard decisions/changes, but the politicians of the time bottled it.

We should have had income tax rises in 2008 and 2021 to start to pay for the debt we incurred on both financial disasters, but political leaders were too scared (or their paymasters told them not to!). How else did Brown and Sunak think the country would pay for the hundreds of billions we had to borrow for those events? Duh! And the global financial markets/investors would have been more lenient towards us as they knew the reasons for the massive debt we took on. Now, we're supposed to be in "better" times and the economy should be growing, so the global lenders and financial markets are right to give us a kicking in terms of higher interest rates and debt costs as we're clearly not properly managing our failing economy (as we didn't in the aftermath of the 2008 crash either).

So, the problem is employers aren't paying enough.

As a couple on decent incomes, with no kids, a small mortgage and no other debts, we don't need to "hunker down" as such, but don't do a lot of what we used to because it no longer feels worth the money.

Meals out, day trips, weekend b&b breaks, ticketed events. Service is poor, everything is rushed, quality has gone down. So we spend much more time at home than we used to and will naturally be saving money that way.
We also normally do 2 holidays a year - a long haul and a European city break. We've decided to ditch the European city break as they don't feel worth it any more, now flights are so expensive and budget travel is such a grim experience. So we'll save money through that too.

We always have enough in savings that we could both be out of work for a year and make ends meet, and have low enough fixed outgoings that we could cover them with bar or shop work (although I appreciate those jobs will become more competitive as more people are made redundant).

It really is TAX fraud if your intention is to stop the taxman getting his hands on it. Pretty obvious definition of fraud/tax evasion really.

And no, it's not mainly illegals. We've openly had reputable tradesmen, reputable scaffolders, reputable car bodyshops openly offer 20% off for cash in had for no invoice. These were big amounts of a few thousand, not just a tenner for a Saturday morning job. One landscape firm asked us to send a cheque to his supplier to pay for materials on a different job to keep the money out of his books so he could avoid registering for VAT. That's tax fraud/evasion in anyone's book. A scaffolder quoted £2,400 for all round scaffolding on our house for roof repairs and without asking said he'd do it for £2,000 if we paid cash and didn't want an invoice.

No one has a problem with slipping a mechanic neighbour £10 or £20 to change a tyre or an oil change on a Sunday afternoon, but when it gets to thousands, then it really is an epidemic of illegal tax evasion/fraud, even moreso where staff/employees/subbies are involved as that leads to multiple instances of tax evasion (and often benefit fraud) through the different hands/levels.

It really is TAX fraud if your intention is to stop the taxman getting his hands on it. Pretty obvious definition of fraud/tax evasion really.

Oh, really? I guess you've forgotten about Angela 'Three homes' Rayner, have you?

Higher wages AND higher benefits both cause inflation, so it's a vicious circle.

Brown's tax credits helped increase house cost inflation and general inflation, which is inevitable when money is pumped into the economy.

If we somehow found ways to increase wages, then we'd have to keep benefits at the same level, or reduce them, otherwise there'd remain no incentive to work/work more, and inflation would rise, meaning people still wouldn't be able to live, even on higher wages, as costs would have risen accordingly.

Inflation is caused by payrises and money printing. Money printing debases the value of the currency. Which coming off the gold standard in 1971 allowed for.

The GBP has lost 46% of it's value since 2006. So your £1 has about the same spending power as 54p.

One small correction; inflation isn't caused by payrises. Payrises force the prices of products and services up, which in itself doesn't inflate the currency. But the effect is similar to that of inflation, especially when the currency has already been quite severely debased through years of printing.

The problem is RR what is not up to the job. The economy was going 'great guns' under Hunt. I'm no great fan of Hunt but he did a far better job than RR. Taxing business always puts unemployment up. Everyone knows this yet that was what RR chose to do. She borrowed more money knowing she'd have to repay higher interest. If she had made only modest changes in her first budget the chances are the economy would be in better shape. The markets hate rapid and large changes all at once. She has lost the confidence of businesses and money markets with her gung-ho attitude. She has attacked all low hanging fruit eg. pensioners, the disabled and farmers. I suppose there is still orphan's she could target next. I wish KS would sack her, only he can't because Labour don't have a wealth of finance experts in their ranks to replace her with. Still far too much money is wasted in public services. Bankrupt Birmingham can apparently afford to pay people to remove flags but not empty the bins. The quicker we get rid of this dreadful Labour government the better. Net Zero is costing hundreds of billions of pounds yet might only work if the rest of the world got on board. Instead Mad Miliband seems to have such great influence to bankrupt the UK.

She resigned though didn't she. Because she made a mistake. Not committed fraud like you literally are if you pay in cash to avoid tax.

A (very dear) friend voted for Brexit based on the argument that it probably would cause short term economic pain but that this was worth it for getting freedom from the EU/the long term advantages. Except now the economy is stuttering she is really angry at the thought of having to pay more income tax on top of everything else. She is genuinely a good friend but I can't help thinking "so when you said short term pain was worth it you meant pain for other people presumably" (I dont think Labour can cut the welfare budget or other spending by any significant amount without causing severe issues. So then they have to raise taxes. Which sucks, but I don't get the argument the poorest should pay for the current economic woes.)

"so when you said short term pain was worth it you meant pain for other people presumably"

You've hit the nail on the head there.

Trouble is he’s just as culpable.

No, not at all. Benefits pay too much

Hunkering down I don't know, but definitely keep my money in my country of origin and the possibility to return.

It's not just Mad Miliband though?

Ecotricity (green energy company) owner Dale Vince was one of the major Labour donors, he pumped over £5.5m in their campaign. Labour are paying the debt to him now with all this Net Zero initiatives. Straight from your pocket to his.

so you paid £2400, right?

As a parent with a disabled child this comment makes me physically ill.

Net Zero is costing hundreds of billions of pounds

Source?

It's a bit of a mess isn't it? DH and I are in our late 30s/early 40s, two DDs at primary school and both work in decent, professional-level jobs. On paper we should be fine but like everyone else we are really feeling the pinch.

There are redundancies everywhere. I have survived the first round of lay offs at my company but they're already talking about the possibility of more. DH is expecting redundancies to hit his workplace in 2026. Of my close circle of friends, four of them have lost their jobs in the past six months. These are just normal working mums in the professional services sector. It is terrifying.

What that means for DH and I is essentially no big changes. There's no point looking for other work if everywhere is facing cutbacks and potentially missing out on a decent redundancy payout due to our salaries and length of service. But that in and of itself feels like a risky choice.

We will not be moving house, which had been on the cards. Our mortgage rate just increased by £200 a month and that's with fixing for 5 years because we can't face even more uncertainty. We can manage that increase so would rather have a known bill than face the possibility of large fluctuations in interest rates.

We are no longer going out for meals, buying new clothes and paying for the services we used to. I've just had to stop having our window cleaner come round but in reality this hunkering down, staying at home and saving what money we can doesn't help the situation. Neither do people in OP's situation, the "economically inactive." People that could work and be paying income tax into the pot but are choosing not to because they're sick and tired of it. This isn't a dig @IsUnemploymentRising, I think the number of people that left the workplace post-Covid lockdowns is really concerning but on an individual level of course I understand why you make that choice.

I'm not sure what the answers are.

The uk purse is only empty because it’s held in private hands and institutions

what happened after WW2 was a redistribution of wealth to lift the poor out of death and slums whilst the rich bemoaned the death duties

Sure, because I've avoided stamp duty, haven't I? 🙄