MILLIONS of households will need to make a note of seven major money changes coming up in the calendar next month.
From council tax rises to new cost of living payments worth £299, lots is happening in February.
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The third instalment of the £900 cost of living payment is set to hit bank accounts for households on certain benefits.
But those on one specific benefit will have to wait a bit longer before it hits their bank accounts.
Plus local authorities will begin to announce how much council tax will rise.
The Bank of England will meet at the beginning of the month to determine the UK’s interest rate, in a move that could affect thousands of homeowners and savers.
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The changes are all important to know so you can plan ahead and avoid being caught off guard.
We’ve explained everything that’s happening below.
1. Interest rate changes – February 1
The Bank of England will announce any further changes to interest rates on February 1.
Decision-makers on the Bank’s Monetary Policy Committee (MPC) are widely expected to keep interest rates at 5.25% for the fourth time in a row.
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It would continue to take some of the pressure off borrowers who have seen costs go up steadily from lows of 0.1% at the end of 2021, to the highest rate since early 2008.
Inflation has mainly dropped in recent months, as fuel prices have come down and food price rises have slowed.
However, the rate of Consumer Prices Index (CPI) inflation rose to 4% in December, from 3.9% in November, the first time it had increased since February last year.
The surprise increase led economists to say it is unlikely that the Bank will look to cut interest rates – a tool they use to control inflation – any time soon.
Check what another pause means for your money.
2. Cost of living payment – February 6
Households on certain benefits, including Universal Credit, will receive the £299 payment directly into their bank accounts between February 6 and February 22.
Those eligible for the tax-free payment won’t have to do anything as it will be made automatically.
The full list of benefits that qualify people for the payment is:
- Universal Credit
- Income-based jobseekers allowance
- Income-related employment and support allowance
- Income support
- Working tax credit
- Child tax credit
- Pension credit
You need to have been entitled to a payment of any of the qualifying benefits above between November 13 and December 12 to be eligible for the free cash.
If you were later found between the same dates you will also be eligible for the payment too.
Households on tax credits only will receive their payment from HMRC after the others are paid by the DWP.
This payment will be made between February 16 and February 22.
This is to ensure that those on other benefits and tax credits will not get the payment twice.
3. Sky Mobile price hikes – February 14
The majority of Sky Mobile’s phone tariffs will soon increase, so you will likely see a rise.
From February 14, bills for Sky’s the average out-of-contract customer will see their monthly bill go up by 3%.
The majority of our data tariffs of 20GB and below are increasing by £1.
Tariffs of 25GB or above are increasing by £2, while some customers will see a £3 increase.
While this may seem small it means customers face an annual rise of between £12 and £36.
Around 71% of out of contract customers will be affected by the rise, according to Sky.
Most mobile phone providers increase their prices slightly at the start of the year, although this is the second time in six years that Sky has raised the prices on any of its mobile plans.
The Sun has put together a guide to the exact time to haggle or switch to cut your bills.
4. Energy price cap review – February 23
The energy price cap limits the amount an energy company can charge you for a default tariff, based on average use.
It is reviewed by the regulator Ofgem every three months and is adjusted to reflect the wholesale cost of energy.
The next adjustment will be announced on February 23 and will come into effect on April 1.
The cap limits the unit price of gas and electricity suppliers can charge.
Experts believe the price cap will fall by the equivalent of more than £300 a year from April.
Cornwall Insight predicts that the price cap will fall from the current £1,928 to £1,620 from April – £40 lower than it predicted in December.
5. Last day to claim Warm Home Discount – February 29
The Warm Home Discount scheme is paid to millions of low-income households each winter to help with increased heating costs.
The money isn’t paid to you but is applied as a credit on your bill.
In the vast majority of cases, it’s automatic, but there are thousands of households who have to apply for the rebate, due to the way the scheme operates.
The deadline for this is February 29.
You can find out more about the warm home discount scheme in our guide including how to apply and the eligibility criteria.
6. National Insurance changes – February
The main 12% rate of employee National Insurance Class 1 contributions was cut to 10% on January 6, but most people will see the change take effect for the first time in their February paycheck.
Jeremy Hunt announced the change as part of the Autumn Statement.
The change will help 27million people and it means that someone earning an average salary of £35,000 will save over £450.
It is also good news for millions of self-employed workers who will also get to keep more of their hard-earned cash.
To see how much you’re set to save, have a look at our story.
7. Council tax changes – February
Council tax is once again expected to rise from April 1.
But the exact amount payments will rise by is set to be announced in February.
The payment is an annual fee you pay to your local council.
The cost is set by your council and goes towards funding local services.
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This year saw the majority of local authorities hike rates by 5% – though in some cases bills went up by 15%.
Households in six council areas across the UK may be forced to pay more in council tax from this April.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected].
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