Sep 2023 CPI Rate on the horizon

[Late & Tired]

Is anyone else keeping a crafty eye on the Sep 2023 CPI Rate, due to be announced on 18 Oct, or am I the only mercenary ex crusty on here?
Hopefully be close, or better still above the annual wages for the triple-lock (although the CPI has been going down of late).
Next year for the State Pension too...

 

[Tin basher]

Oh fear not L&T the beady rummy old eyes of TB are fixed on the date, just need to find my best reading glasses beforehand

 

[Late & Tired]

Oh fear not L&T the beady rummy old eyes of TB are fixed on the date, just need to find my best reading glasses beforehand

Shocked and stunned, my young friend...

 

[Billy Whizz]

For the first time, this year I will be, gotta be better than the CS pay rise and worth more actual cash in hand!

 

[muttywhitedog]

I have a keen eye on it too. My current pension and salary push me to the cusp of the 40% threshold and I know that next April I will enter that territory, with all its associated punitive measures. The pension rise announcement will shape my next decision as to whether I request to cut my hours by a small amount, increase my pension contributions, or invoke a partial retirement entitlement and cut down my hours by at least 20%.

 

[busby1971]

You do know that you will only pay 40% on money above the threshold, and NI reduces so the increased take is only about 10%.

The value of my commuted pension having not risen for 13 years feels quite low nowadays, quite looking forward to jump in a couple more years.

6.7% it is then.

 

[Tin basher]

UK inflation rate remains at 6.7% in September

The inflation rate remains steady in the year to September, ending three successive monthly drops.

www.bbc.co.uk

6.7% more beer chits nice

 

[Late & Tired]

It's 6.7% only if the Govt don't use the metric associated with the Triple-lock; if this IS honoured, the higher value figure associated with average earnings (7.8 to 8.2% inclusive of bonus') SHOULD be used.
The question to be asked is "will the Govt honour the Triple-lock' based on these figures for the 2024 adjustment in April..."

 

[muttywhitedog]

You do know that you will only pay 40% on money above the threshold, and NI reduces so the increased take is only about 10%.

The value of my commuted pension having not risen for 13 years feels quite low nowadays, quite looking forward to jump in a couple more years.

6.7% it is then.

Yes, but I will also lose £500 of my savings allowance and the ability for my wife to transfer 10% of her allowance to me.

 

[muttywhitedog]

It's 6.7% only if the Govt don't use the metric associated with the Triple-lock; if this IS honoured, the higher value figure associated with average earnings (7.8 to 8.2% inclusive of bonus') SHOULD be used.
The question to be asked is "will the Govt honour the Triple-lock' based on these figures for the 2024 adjustment in April..."

Govt occupational pensions have always risen by Sep CPI, even in Camoron's austerity govt. Its only the state pension that has the triple lock. I expect the Govt will honour it this year as keeping the crusties onside is their only chance to avoid obliteration at the GE

 

[Captain Kirk]

Yes, but I will also lose £500 of my savings allowance and the ability for my wife to transfer 10% of her allowance to me.

Mutty, if you can afford to, bang your excess in a SIPP.
It’s a fine government endorsed method of ‘reducing’ your income when you want to.
It’s worth a read into, and every financial player out there has a piece on it.

 

[Downsizer]

SIPP? Is that a private pension?

As I am firmly in the higher tax brackets I'm always looking for ways to reduce my tax bill and maximise further pensions, but I'm pretty clueless TBH.

 

[Donkey871]

SIPP? Is that a private pension?

As I am firmly in the higher tax brackets I'm always looking for ways to reduce my tax bill and maximise further pensions, but I'm pretty clueless TBH.

There are a couple of ways to achieve that aim. You can increase your payments into your employer's pension scheme, which might have the bonus of your employer matching your contributions (normally up to a certain level only) which has the effect of reducing your taxable income by the amount contributed, or, if you have a personal pension fund or SIPP you can make contributions to that which will attract the 25% tax rebate automatically and you can then reclaim the additional tax paid on that amount up to the amount of 40% tax you have paid.
If you are unsure about all this you should get a financial adviser. (I'm not one but I've learned the hard way)

 

[Downsizer]

Already maxxed out contribution to the company scheme.....

 

[Tin basher]

Its only the state pension that has the triple lock. I expect the Govt will honour it this year

Agreed any political party, of any hew, that even suggested ditching it would be toast

 

[Late & Tired]

Hypothetically, if you were to work in an energy company, say, Oil & Gas and encroaching on a higher tax threshold, I would be tempted not to have a financial payrise, but to negotiate offset benefits. Such benefits could possibly include a company car with a generous fuel allowance and vouchers, electric, gas and even water bills paid by the company upto the 7% company value pay rise. Just speaking hypothetically of course, if you were working for a good company...

 

[muttywhitedog]

The good news for me is that my taxable salary + new RAF pension comes to a whole £1 less than the 40% threshold, and as the RAF pension kicks in on 10 April, there'll be another 4 days worth to keep me under the threshold, until July, when the annual pay rise will kick in. At that point I'll have to review my situation and see if I can either cut my hours by 5%, increase my pension contribution by 5% or request partial retirement. The other factor to consider is would a different colour Govt re-introduce the annual rise in tax threshold levels?

 

[Captain Kirk]

Say you earn 55k, you put 5001£ in your SIPP (a personal pension of sorts) then you go right back to being a lower rate tax payer. The downside is you can’t touch it til age 55.
At 55 you can take 25% out tax free, or leave it. ( basics, as there are other options). It’s not for everyone, but it is TAX EFFICIENT.
Leave it and it builds and you gain loads from compound interest.
I’m not a boring bxstard but over the years, the more I’ve read the more sense it’s made!!
Now, with a Labour government inbound I’ve discovered Gilts, but so have all the papers.
I’m not a financial advisor, but I’ve learnt loads from being a boring Bxstard I’ve read in.

 

[Mug?]

Oh I miss RPI....8.9 apparently and 12.6 last year.
I know its pointless keeping an eye on that now, but that's already now an £11K gap/difference in my expected lump sum.

 

[Spearmint]

Oh I miss RPI....8.9 apparently and 12.6 last year.
I know its pointless keeping an eye on that now, but that's already now an £11K gap/difference in my expected lump sum.

When the treasury make changes, it's never to make things easier or fairer. It's always to save money.