Understanding the Impact: How the UK's Autumn Statement Affects You Across the Board

the Autumn Statement might play out in everyday life for different folks in the UK. It's quite a mix of changes, and they're likely to touch a lot of lives in various ways.

1. For the Self-Employed: Imagine you're running your own small business or freelancing. The cut in national insurance contributions is a bit of good news. It means you'll keep more of what you earn. Think of a self-employed person making around ￡28,200 a year; they're going to see an extra ￡350 in their pocket annually. That could be a real boost, maybe helping to cover some business costs or just making day-to-day life a bit easier.
2. Employees: Now, if you're working for a company and earning a typical salary, say ￡35,000, you're also in for a pleasant surprise. Your take-home pay is going up thanks to the reduction in national insurance contributions, by about ￡450 a year. It's not a fortune, but it could make managing bills or saving a bit easier.
3. Pension Changes: This is interesting, especially if you've hopped between jobs. Now you can have your pension contributions go into a fund of your choice. It's a big help in keeping track of your retirement savings. And for those already retired, the state pension bump of 8.5% is significant, especially for those who rely heavily on it.
4. Savers and Investors: The tweaks to Isas are pretty neat. You've got more flexibility now, like being able to spread your savings across different types of Isas in the same year. It's a nice way to diversify your investments and potentially get better returns.
5. Homeowners and Renters: There's talk about making it easier to convert houses into flats, which could mean more housing options and maybe even lower rents. Plus, the increase in the local housing allowance should offer some relief to families struggling with rent hikes.
6. Low-Income Workers and Families on Benefits: The rise in the national living wage is a big deal if you're earning at that level. More money in your paycheck can really help with the cost of living. And if you're on universal credit, the increase there is going to provide some extra cushion.
7. What are the experts saying?

Shah, chief executive, Blick Rothenberg Nimesh Shah

When is a tax cut not a tax cut? The ￡50bn cuts to national insurance contributions are not as generous as the chancellor proclaimed. Lower earners might have preferred an inflationary increase to the personal allowance: someone earning ￡20,000 would have been ￡185 better off (compared with ￡149 for the NIC changes) had Jeremy Hunt simply increased the allowance by the 4.6 per cent rate of inflation.? Frozen allowances and tax thresholds continue to cause pain for taxpayers. Middle earners may feel slightly less squeezed after today. Someone earning ￡60,000 is going to be ￡63 a month better off with the 2 per cent NIC cut. But accounting for inflation after 2010-11, they have taken a real terms hit of almost ￡17,000 over that period.? Abolishing class 2 NICs for the self-employed is generous, but I don’t see the self-employed doing cartwheels. They were handed a ￡179 saving from the class 2 move, and a 1 percentage point class 4 NIC cut from April 2024. I would have liked to have seen reform of the IR35 off payroll working rules, which continue to cause frustration.

Christine Ross, client director at Handelsbanken Wealth & Asset Management

The Autumn Statement delivered some immediate relief from tax for many, though there were no announcements in the speech for savers. The annual limits on individual savings accounts (Isas) are frozen at the present level of ￡20,000 for the next tax year.? There were nonetheless substantive changes to the Isa regime in the Treasury documents. Savers will now be able to open multiple Isas of the same type within a single tax year. At the moment individuals are restricted to one cash Isa and one stocks and shares Isa annually.??? Savers and investors will also be able to ask for a partial transfer of an Isa fund to another provider. With some attractive cash deposit rates on offer, this increased flexibility should stoke competition and allow savers to vote with their feet. However, it is a measure that risks increasing the incidence of duplicate subscriptions.?? The minimum age for Isa applications has been set at 18. At present, a minor can have a ￡9,000 Junior Isa annual subscription until age 18 as well as a cash Isa from age 16, allowing 16 to 18 year olds (or their parents on their behalf) to save a total of ￡29,000 in each of the two years. An anomaly welcomed by young savers and their parents, it will now end.

Simon Edelsten, former fund manager Simon Edelsten ? Charlie Bibby

Retail investors may benefit from the extension of capital allowances, with some mature large companies in the FTSE index having substantial fixed assets. (Smaller growth stocks often have more intangible assets.) Many of these large UK stocks plan to invest to reach net zero targets. They also often have very high current dividend yields, such at British Telecom or British Land, yielding over 6 per cent.? Hunt announced plans to sell more of its holdings in NatWest Group, referencing the “Tell Sid” advertising campaign of the 1980s. British Telecom and British Gas were among those privatisations which encouraged British savers to dip their toes in the stock market. But investing in utilities like these is a different proposition to investing in a bank. The value of a bank’s shares has been well described as “the sliver of hope between massive loans and deposits”. The latest placing in NatWest may not be very popular with the public.

Laura Suter, head of personal finance, AJ Bell

The idea that you can have one pension pot for life, following you around your various jobs, is good in theory. The average person changes jobs 11 times in their lifetime. We know that there’s an estimated ￡27bn sitting in lost pension pots — and any plan to reunite them with their owners should be applauded. But making it a reality looks challenging. For it to work, every business in the country, from the local hairdresser and café to multinational companies, would potentially need the ability to connect with any pension scheme in the country.? The government acknowledges that this would require a central clearing house, but has swatted away any mention of who would build or pay for it. This won’t be a quick win, if the delays besetting the “pensions dashboard”, a similar project, are any guide.? And while the branding of “pot for life” is great, employees can make it a reality already, by consolidating their pension schemes in one place. They don’t need to wait for the government’s latest proposals to come to fruition.

So, all in all, these changes are pretty wide-ranging. They're likely to affect a lot of people in different ways, from freelancers to retirees, and from savers to those just trying to make ends meet. It's all about how these changes fit into your personal financial picture.