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🔮 Budget week predictions ✅ The Ultimate Payday Routine + 🎶 The Best Music for Productivity

🔮 Budget week predictions ✅ The Ultimate Payday Routine + 🎶 The Best Music for Productivity

The 99 - 28th October 2024

October 28, 2024

Good afternoon and welcome to The 99: the home of financial news and insights made simple. You can count on accessible, trustworthy, and unbiased news insights every Monday.

Throughout each month, we'll explore a specific theme; sharing knowledge in bite-sized and actionable guides that are easy to grasp and apply to your own financial journey. Scroll to the bottom for October’s final explainer: Getting paid and setting up a financial routine.

Alice x

£300,000

The value of cheese stolen from London cheese firm Neal's Yard Dairy.

Posing as wholesalers, the cheesy thieves made off with 950 truckles, including included 22 tonnes of award-winning varieties such as Hafod West, Westcombe and Pitchfork.

Did you see the most heartwarming

confession of all time?

“My Grandad’s For When I’m Gone File Changed My Life”

A reminder that you have until this Thursday to 31st to claim your free will.

Octopus Legacy is a brilliant company helping plan for death and find support after loss.
They’ve partnered with charities from across the UK to cover the cost of your will so you can write or update your will for FREE, saving you up to £250.

You can write your will in whatever way suits you best:
🌐 Online
📱Over the phone
👥 In-person

Many choose to leave a gift to charity as a thank you, but it isn’t required to claim the free will offer.
Click the button to claim your free will before this Thursday 31st 📝

Premium Bonds: What’s Changing and What You Should Know

🚨 A Reminder: What Are Premium Bonds?

🫡 Premium Bonds are government-backed savings accounts from National Savings & Investment (NS&I), meaning your entire investment is 100% protected.

✅ They are the most popular savings account in the UK, with £126 billion saved with them.

🏆 But instead of earning regular interest, you enter a monthly prize draw where you could win anywhere from £25 to £1 million—all tax-free.

🏧 You can withdraw anytime with no penalty, making it a super flexible savings option.

Recent Cuts in Prize Rates

Prize rate = the average % return offered

In August 2023, NS&I raised the prize rate to a 24-year high of 4.65%. However, it’s been declining bit by bit ever since.

From December 2024, the prize rate will now drop again to 4.15% (down from 4.4%).

What Does This Mean for You?

The odds of winning have worsened slightly, going from 1 in 21,000 to 1 in 22,000.

Although there are still 2 x £1 million prizes each month, there will be fewer top-tier prizes:

Fewer £100,000 prizes (83, down by 5).
Fewer £50,000 prizes (167, down by 10).

Why Is This Happening?

NS&I attributes the cuts to a “changing savings market”….

A Lower BoE Base Interest Rate

📉 When the base rate drops, it generally lowers interest rates across the board, including for savings accounts and investment products like Premium Bonds.

NS&I Net Financing Target

🎯 Since NS&I is government-backed, it raises money that helps fund public spending, and so the government sets a target for how much it should raise each year. Lowering the prize rate ensures it doesn’t attract too much money compared to other banks (a mistake it made in 2023), which could lead to overpaying for funds.

James Bond Snl GIF by Saturday Night Live

Other Changes That Could Affect You

While Premium Bonds are the most famous NS&I product, they’re not the only type of savings/ investment vehicles they offer….

Income Bonds and Direct Saver Bonds will also see return rate drops for the first time in 4 years, to both reach 3.75% starting 20th November.

New Two-Year Bonds: NS&I recently introduced a two-year “British Savings Bond,” offering a 4.10% AER for the Guaranteed Growth Bond option and 4.09% AER for the Guaranteed Income option.

Comments & Insights

“The lengthening of the odds of a win should be food for thought for anyone who is holding money in these accounts and losing money after inflation.” […] “You can do far better elsewhere, with the best on the market offering 4.6%.”

- Head of Personal Finance @ Hargreaves Lansdown

"Some savers might be lucky enough to hit the jackpot or win big early on, but others may save and wait for long periods even for a small return, if any." […] So if you're looking for regular, guaranteed returns, savings accounts or stocks and shares may prove a better choice”

- Senior Personal Finance Analyst @ Interactive Investor

Do you own premium bonds?

🎧

Music at Work: Does It Help or Hinder?

Should we listen to music at our desks?

Here’s what research has to say on the matter...

What The Statistics Say

In 2019, a survey of 2,000 brits by Scala Radio found that about 50% regularly listen to music while working.

👁️ 1 in 3 said it helps them work harder (more focused)…

🧠 while 40% believe it makes them worker better (higher productivity)

😌 50% feel less stressed with background music…

😴 and for those working from home, 2 in 3 would struggle to focus without it.

🎶 What Are They Listening To? 🎶

Instrumental Only	37%
Rock	26%
Classical	25%

What The Science Says

🎧 One small experiment showed that workers completed a 600-word task 3 minutes, or 15%, faster with music than in silence.

🖇️ The Mozart Effect - other studies indicate that certain music, like Mozart, can even improve performance on spatial tasks (think folding paper or puzzles).

🥁 It might be just the beat rather than the melody or lyrics (which can distract your language processing ability) that helps. When information was put into a rhythm, with or without music accompanying it, people were able to remember and recall that information better._{(Purnell-Webb and Speelman, 2008)}

A Blast from the Past: Music and Wartime Productivity

During WWII, the UK government launched “Music While You Work,” a BBC broadcast aimed to boost munition factory morale and output.

It worked wonders, with productivity reportedly jumping by 12.5 - 15%—a big boost when Britain needed it most.

How Music Affects You

🤫 Worse For Introverts

It’s also thought that introverts may struggle more with music on than extroverts. Studies show that introverts handle quiet environments better, while extroverts thrive with extra sensory input.

💡 Not For Leaning Something New

Your ability to learn something new that is cognitively demanding decreases when you listen to music.

🔥 Activation Theory

Music in the 50-80 beats per minute (BPM) range puts your brain in a creative, focused zone.

🔇 Blocking Out Distractions

Tunes create a ‘background ambience,’ helping drown out distracting noises that could waste your attention.

💊 Stress Reduction

Music with a regular beat can actually help you relax by slowing your heart rate and pulse.

🍩 Brain Rewards

Hearing new chords or shifts in music triggers the brain's reward centres, adding a little mood boost to your day and making it much more pleasurable to complete tasks.

Music At Work - Yay or Nay?

Can't live without it | Depends on the task | Silence is success

🖥️

What's Happening with the Government’s 'Pension Dashboard?’

What is it, why is it delayed, and when will you actually be able to use it?

👀 What Is The Programme? 👀

The pension dashboard is a secure, online platform designed to help individuals track their pension savings in one place (state, workplace, and personal).

The initiative was pledged by the UK government in 2016 to help people manage multiple pension schemes and avoid losing track of savings.

The dashboard will allow you to confirm your membership in different pension schemes and provide a clearer understanding of your total retirement savings.

Why Do We Need It?

📍 All In One Place 📍

On average, people build up 11 different pension pots over a career, which can be tough to keep track of. £50 billion is just sitting in lost pension pots, according to the Centre for Economics and Business Research.

💡 Sparking Retirement Plans & Awareness 💡

Around 75% of adults aren’t sure how much they have in their pension, rising to 79% for those aged 55-64 and 81% for women.

What’s The Delay?

🕳️ Originally, the dashboard was supposed to have been rolled out by now, but according to the National Audit Office (NAO), a lack of digital skills and weak governance has added £54 million to its budgeted costs (23% over).

🗓️ Now, the government has pushed back the launch time by 1 year.

When Will We Actually Be Able to Use It?

Here’s the current timeline:

☀️ August 2024: Key organisations (including the state pension) begin integrating.

🌦️ April to November 2025: Large pension schemes connect.

⏳ January to September 2026: Medium schemes connect.

🌍 October 31, 2026: All 3,000 pension schemes and providers are required to be on the system.

🚨

But the NAO report also hinted that this might not even be the date by which the 16.3 million of us who’ll use it can access it, and that the Department for Work and Pensions did not specify when it will be available to consumers.

Watch this space for updates.

It’s Budget Week! What it could mean for you

🙋 What is it?

Every year, the Chancellor of the Exchequer—responsible for managing the government’s finances—delivers a Budget statement to MPs on their plans for adjusting taxes and spending. MPs will then debate and approve the plans in the House of Commons and the Budget will then turn into law.

📆 When is it?

Wednesday 30th October, approx 12:30 PM for 1 hour.

👀 Where can you watch it?

The speech will be broadcasted live on BBC iPlayer and the BBC News website.

You will also be able to read a detailed report published by The Treasury on both how they did the maths and how they’re going to implement the strategy.

A Recap: What Has Already Been Announced?

❄️ Winter Fuel Payments ❄️
From now on, only those receiving pension credit or other means-tested benefits will get winter fuel payments. There’s been plenty of criticism on this front, from MPs to unions.

📚 VAT on Private Schools 📚

The standard 20% rate will apply to private school fees from 1st January 2025. The average private school fee charged across the UK is £15,000 per year.

📈 State Pension Increase 📈
Mark your calendars! The state pension is expected to see a 4% bump in April 2025 – final confirmation is coming in the budget.

🛢️ Energy Windfall Tax 🛢️
Oil and gas profits in the UK are set to face a steeper 38% levy until 2030, up from 35%. The increase is expected to raise an extra £2 billion.

What Are We Expecting?

Area	Current Rule	Predicted Changes
Inheritance Tax	A 40% tax applies to assets over £325,000 when passed on to beneficiaries.	Adjustments to exemptions could lead to a higher tax burden for some families.
Capital Gains Tax	CGT is levied on profits from selling assets. Higher earners pay 20% on most assets and 24% on additional property sales.	A rise to 39% was rumoured, but the prime minister has “appeared to dismiss [the] suggestion”.
Income Tax & NI Thresholds	Income tax and National Insurance thresholds are frozen until 2028, meaning income-based tax brackets stay the same.	The freeze could be extended, drawing more people into higher tax brackets as wages rise.
Employer NI Contributions	Employers pay 13.8% NI on employee earnings and don’t pay NI on pension contributions for staff.	There may be an increase in the employer NI rate and the addition of tax on pension contributions for staff.
Debt Rules	The government follows strict rules on how and how much they can borrow.	The chancellor could redefine how they classify debt, allowing up to £50 billion more borrowing.
Pension Taxation	Pension tax relief is based on income tax brackets: 20% for basic, 40% for higher earners.	A single flat rate may replace the tiered system, or we could see a lower cap on tax-free lump sums.
Non-Dom Tax Status	UK residents whose permanent home is outside the UK only pay UK tax on UK earnings, with foreign income untaxed.	Labour may push for stricter rules on non-dom status, or abolish it altogether.

Recent News Stories to be aware of

🛫 Millionaire Migration 🛫

Looks like a record 9,500 millionaires are eyeing the exit from the UK in 2024, which would more than 2x last year! Henley & Partners reports that worries about even more tax hikes in Labour's first budget are pushing them out, especially from London. The hot spots they’re heading to include Paris, Dubai, Amsterdam, and even places like Florida and Portugal's Algarve.

🩺 What £ Will It Take to Repair the NHS? 🩺

The NHS in England might be in for a good 4% funding boost when Rachel Reeves rolls out her budget. But hold on—there’s also still a hefty £4.8 billion gap (‘unfunded shortfall’) in the budget for 2024/25. Without more cash, we could be looking at service cuts. To plug the gap, the total revenue for the Department of Health and Social Care for the current financial year needs to be to £186.4 billion.. Fixing the their crumbling buildings alone will cost nearly £14 billion - even more than the £13.6 billion it spends on running its entire estate in the first place!

October 101

The Fundamentals - Getting Organised

1. Typical Payday Vibes

Payday often brings a strong impulse to spend…

71% of people tend to spend more in the week after payday.

1 in 5 spend over 50% their spare wages within 48 hours of being paid.

59% experience spending regrets after payday because of impulse buys.

Almost 50% will also dip into their savings to make it through to the next paycheck.

_{(Nationwide Building Society)}

2. Setting Up Your Payday Routine

Step 1. Review Your Payslip 🔍

👩‍⚖️ The Law 👩‍⚖️

All employees and most workers (incl. zero-hours & agency) are entitled to receive a detailed payslip - online or physical - on or before payday.

🚨 The Importance 🚨

Your payslip is more than a formality – it’s a key tool to ensure your employer has paid you correctly and you’re up-to-date on deductions like tax and NI.

Who is NOT Entitled to a Payslip?

Self-Employed Individuals. Since they handle their own tax and deductions, self-employed people do not receive payslips. A few other specific groups do not have a legal right to a payslip, but may receive a similar breakdown of pay and deductions anyway, e.g. Armed Forces Personnel, Police Officers, Merchant Seafarers and Fishermen/women who are paid by profit share.

A Quick Guide to Tax Codes 🆘

Your tax code is a unique combination of numbers and letters used by HMRC to tell your employer or pension provider how much tax to take from your pay. Here’s a breakdown of common tax codes and what they mean:

Standard Tax Code (e.g., 1257L)

For most people, this code indicates how much of your income is tax-free. For example, 1257L means you can earn up to £12,570 before paying tax.

BR Code

Your income is taxed at the basic rate of 20% with no personal allowance applied. This often happens if you have multiple jobs or HMRC needs more information from your employer.

D Codes (e.g., D0, D1)

Typically used when you have more than one income source. Your personal allowance is applied to your main income, so your second source is taxed at the basic or higher rate.

K Codes

If your code starts with K, it means you owe tax from past years or have taxable benefits like a company car. You will never pay more than 50% your income to cover these.

Emergency Tax Code (1257L W1, 1257L M1, 1257L X)

Assigned when HMRC doesn’t have all your information. These codes tax you as if only basic personal allowances apply. They’re temporary and will be corrected once HMRC has updated information.

Step 2. Pay Yourself First 🫵

The oldest trick in the book. Pay a designated amount into your savings/retirement/goal pot first. Then spend and budget with the rest. This is the simplest way to prioritise savings. ICYMI, see here for the GFY Guide to Budgeting (Realistic edition).

Step 3. Check in on Your Automatic Payments 📩

Make sure everything that can be automated, is. You can change the date of most of your payments so they hit your account just after payday. If they aren’t scheduled for then, set that money aside immediately (you could have a separate pot for bills) so you’re never caught short again.

Step 4. Do a Quick Scan of Last Month’s Transactions 📋

😬 Scan For Unexpected Charges

If you notice any unauthorised transactions, remember your rights to dispute them.

Chargeback - allows your card provider to reclaim money from the retailer’s bank under certain circumstances. Chargebacks are not a legal right but rather a voluntary scheme managed by American Express, MasterCard, and Visa. For the best chance of a refund, initiate a chargeback claim with your card provider within 120 days of the transaction or expected delivery date.

Section 75 ₍_{Consumer Credit Act 1974)}

Provides great protection if you made a credit card purchase for goods or services costing £100 -£30,000. This law makes your credit card provider jointly liable with the retailer.

Section 75 also covers you if the company goes out of business and can cover associated losses beyond the original purchase. Claims must be made within 6 years of the purchase date or expected delivery.

🔙 Check On Your Refunds

Use this time to follow up on any pending refunds from returns or cancellations. Free apps like Snoop can help track these and send you refund alerts.

📺 Check Your Subscriptions
Monthly subscriptions add up fast, and yearly subscriptions can fly under the radar. 1 in 10 people pay for content they don’t use, with 65% spending more than £132 a year. Take a look at any subscriptions sneaking money out of your account that you don’t need anymore. You can also use chargebacks if you are charged for a repeat payment after cancelling a subscription. And don’t forget to check for automatic enrolments after free trials—those "try it free for a week" offers can quickly roll into a paid monthly plan without you realising it. Set a calendar reminder! Again, apps like Emma and Snoop can track these for you.

Step 4. Check In With Your Goals 🥅

Review your progress toward any short-and long-term financial goals. What went well? What didn’t work? Use this moment to adjust or plan for the coming month based on any new priorities or life changes. The things that you want to achieve with your money can and will change.

✅ Week 4 Checklist ✅

Easy and quick actionable life admin you can do right now

⬜️ Create a list of every active subscription you pay for or use an app with a subscription tracking feature like Snoop or Emma.

⬜️ Change the date of substantial payments to the same day, just after pay day

⬜️ Check your tax code is right

Sources/Read More:

Premium Bonds: What’s Changing and What You Should Know

Music at Work: Does It Help or Hinder?

Read More on Worklife
Read More on BBC
Read More on The Independent
Read More on Forbes
Read More on Harvard Business Review

What's Happening with the Government’s 'Pension Dashboard?’

Britain Holds Its Breath: It’s Budget Week!

Read More on BBC