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 answer is that they have to restore confidence by doing something big like a big trade deal with the EU.

@persephonia Net zero absolutely costs a fortune - one example, DH works in the design team for schools heating and electricals, all schools are being pushed towards air pump heating systems, however - the cost of the electricity for running these in schools is around double the current gas costs, plus the huge outlay for purchase and installation in the first place. but the initiative is that they must have them, and so schools have to find the money for them.

So you admit to enabling tax dodging then, if you pay contractors cash. I have to pay taxes so why shouldn't they?

No, we refuse to use dishonest tradesmen so we gave the work to a different firm who weren't tax evaders. If they're dishonest in one aspect, they're probably dishonest/fraudulent in other ways too.

High housing costs and low wages mean those with children are not able to afford to increase hours as the increased pay means they are worse off if they lose in work benefits and have to fund extra childcare. The individual doesn’t benefit as they are trapped in part time low paid work until benefits are dramatically reduced as their DC age which impacts career progression, pension accrual etc.

The dire state of the economy shows that state support for landlords and employers has only had the effect of increasing profits for them with no trickle down positive effect for society as a whole.

The proportion of people wholly reliant on benefit is not large enough to make a meaningful reduction in the welfare bill but would have a massive effect on individuals. Hence Labour’s plan to cut disability benefits by reforming PIP criteria and introducing a 4 point rule would have done more harm than good and cut the benefits of those with physical disabilities who scored 2 in multiple areas whilst those with severe anxiety, MH conditions and ND who already score 4 would be unaffected. Given nobody gets disability benefits for mild anxiety this is a moot point. Fails financially and ideologically. As things stand, most currently reliant on benefit and not in work whilst employable would be eligible for in work benefits due to low wages.

There will only be a financial benefit to work when wages are sufficient to pay for reasonable housing and living costs. Just like it was when you were younger OP.

The benefits bill is increasing because we have an aging population claiming state pension for longer and no government is willing to means test state pension so we have an unequal system with some pensioners working past retirement age, renting in retirement and reliant on state pension and some that own properties outright, have private pensions and other assets and are able to retire early.

So if you want to halve benefit payments as a means of saving money rather than punishing the disabled, sick and needy you have to do it across the board and then you have to consider whether it is fairer to means test state pension, provide social housing with lower rent and better security and stop subsidising low wages.

Which private hands and institutions?

The most expensive job I've had done that was cash in hand was having my boiler replaced, and that was paid for by my in-laws. We'd just bought the house and were a little strapped for cash (my in-laws gave us a cheque for a huge down-payment for the house, too). The boiler was 15+ years old and not holding pressure, yet it still worked, just about. Do you want to get a pair of 70 year olds done for fraud? "We were helping to keep my son and his wife warm and comfortable in their first home." Not really worth the upheaval, is it?

I think you can look this up yourself / the richest lists are published regularly for both individuals and private businesses including banks

edit to add you can also look up how things have changed over the last 50 years - the gap between the top and bottom 10% for example or the gap between the cleaner and the CEO take home

@PocketSand

High housing costs and low wages mean those with children are not able to afford to increase hours as the increased pay means they are worse off if they lose in work benefits and have to fund extra childcare.

Exactly my point! We need to get rid of such instances in the tax/benefits system. Working and working more must ALWAYS be better than not working or working less. We need some kind of integrated tax/benefit system where the person is ALWAYS at least 50% better off for every extra pound they earn. I.e. the tax/nic deductions AND reduction in benefits MUST be restricted to a maximum of 50% so that they always keep at least half of every extra pound they earn. It's the only way to wean people off benefits when extra work/shifts/promotions etc are available. It's complete nonsense that any worker, at any point of the earnings scale ends up worse off by working more, or worse off taking an extra shift or promotion, either by loss of benefits or the extra tax/deductions suffered. If there was a 50% limit imposed, then people would see a genuine benefit/reason for working, working more, taking a promotion, taking an extra shift etc.

Pretty sure such a philosophy was part of the move from the stupid tax credit system to Universal Credit, but, of course, the politicians and incompetent civil servants buggered it up and the current UC system is just as bad as the old tax credit system and doesn't achieve what it was set up to achieve.

And whilst here we're arguing who should be taxed more and by how much:

Germany to allow retirees to earn €2,000 a month tax-free

Germans who choose to work beyond the retirement age will be able to earn up to €2,000 a month tax-free, as part of Chancellor Friedrich Merz’s push to tackle labour shortages and revive Europe’s largest economy.

We have 25% of working age population economically inactive, people retire earlier than planned because of punitive tax system.
It's not just a direct economic benefit, but people stay active and relevant for longer.
Germans see sense, why can't we?

It’s nonsense that anyone working full time should need benefits ( disability excepted )

now it would be interesting to make a list of the most profitable companies and estimate how much less they would have if none of their staff were given UC / if I get bored I might try

I don't blame your in laws, but the choice to pay cash in hand shouldn't exist, maybe cash needs to go and AI can monitor business bank accounts, that should bring in some extra cash.
Or should we just keep banging on about disabled people and benefit scroungers, because that will solve everything won't it.

Different political ideology atm I’m guessing. We’re stuck with tax them higher Labour

So you enjoy a massive, faceless entity such as the government having visibility and control of money, do you? Why not bring covid jabs, face masks and social distancing back? Let go of any autonomy and freedom you have, not just your money. Sound like a plan?

No thanks. Although you’d fit in with Starmer in that.

It’s not the budget that’s the issue it’s the economic climate that makes the budgeting hard

And things aren't going to get better any time soon.

Germans see sense, why can't we?

We aren't Germany....

Germans who choose to work beyond the retirement age will be able to earn up to €2,000 a month tax-free

They will still pay social security taxes which is one reason the gov are for it.

To be honest I have always aimed to keep things safe. Apart from my house and then bougtht without stretchkng. , I ve never bought anything on credit. We never live beyond our meana. I dont buy stuff unless necessary
I put a little extra into savings and my pension when I can afford to and eat lentils when can't. We are so used to being skint.It doesn't really matter.
I think you just have to always assume it's going to get a bit worse.But just do what you can, when you can.
I'm lucky in thatI have a couple of businesses on the side of my main job which means I can work more than five days a week.If we really need it and dh can work extra shifts if we can't meet our basics.

London School of Economics articles shows £70 billion per year over many years. There are so many articles available on this topic.

I think cashless is a good idea yes

Okay. I agree to disagree. Banking systems will go down and payment providers will go offline again and again. Russian hackers will be blamed as per the norm and I'll have enough hard cash to pay for a week's worth of shopping and a full tank of fuel while everyone else with their cards, phones and smartwatches get declined.

@HalfASandwich I'm intrigued to know why you think cashless is a good idea?

I can't think of any reason to be honest so would love to hear some balanced points as to why?

I've actually in the last month gone back to withdrawing cash for day to day purchases, after seeing an interview with Starmer who said the Digital ID cards will also have the facility to be linked to bank accounts and so spending of benefit claimants could be 'tracked if deemed necessary' I am wholly against a cashless state (disclaimer - I don't claim a single benefit but wholly disagree with this tactic!)

Climate change is costing rather a lot more than net zero - Thames barrier defences just for London over 2 billion

I would prefer income tax to rise to 1980s levels. It’s been far too low for far too long.