So what difference will the Autumn Statement make to your finances?

Simon Read and Julian Knight explain the ramifications

Single Male

If you’re not married, you don’t appear to be worthy of any largesse from George Osborne. He referred to hard-working families in his speech yesterday, and underlined his commitment to the married by introducing a tax break for couples. But what has he done for single men?

That depends on your lifestyle. If you drive you’ll benefit from the scrapping of the planned 2014 motor fuel duty rise of 2p a litre.

If you commute by rail you’ll be pleased about the scrapping of another planned increase: train fares were due to climb by 1 per cent above inflation but now the increase will be pegged at inflation. That means they’ll now climb 3.1 per cent in January rather than the previously planned 4.1 per cent.

You’ll also benefit – as will all taxpayers – from the previously announced increase in the basic personal allowance  from £9,440 to £10,000. That should give you an extra £112 a year in your pocket or roughly just over £2 a week.

Single Female

You have as little good news to look forward to as a result of yesterday’s Autumn Statement as a single male. The increase in personal allowances from £9,440 to £10,000 next April will hand you an extra £112 a year.

You may also be pleased at cuts to planned increases in motor fuel duty and rail fares. The former will save you 2p a litre while the latter will mean train fares will increase by inflation, rather than inflation plus 1 per cent.

Beyond that there was nothing specifically for you in yesterday’s news. In fact, depending on your age, the news that  the rise in state pension age is being accelerated and raised to 70 for those aged 23 or less, could be pretty bad news.

It will affect people in their 40s or younger and will hit those unable to build up a decent private pension. If you’re a carer, for instance, you may have little opportunity to save for retirement and so be forced to rely on the state payout, which could be a few years further away than you hoped.

Poor Nuclear Family

There was nothing to cheer for hard-up families in yesterday’s Autumn Statement, despite the Chancellor claiming that: “The effects of the financial crash on family budgets and the cost of living are still being felt. So where we can afford to help hard-working families, we will continue to do so.”  Poverty charity the Joseph Rowntree Foundation said:  “For the 13 million people living in poverty, the measures outlined will not be enough to tackle the rising costs and lower incomes that they face. Few of the policies announced specifically target these families, who have faced a 25 per cent increase in the minimum cost of living since 2008.”

So what solace is there? The basic personal allowance is increasing from £9,440 to £10,000 next April. That should give each adult an extra £112 a year in your pocket. You may also benefit from the £50 cut in energy bills and the scrapping of proposed rises in motor fuel duty and a slightly smaller rise than planned in rail fares.

And that’s about it, unless you have kids aged between five and seven who will soon qualify for free school meals which could bring a saving of up to £400 a year!

Middle-income Nuclear Family

George Osborne likes you! He likes you so much he’s handed you the possibility of pocketing an extra £200 a year through a simple tax dodge.

He’s introduced transferable tax allowances for married couples from 2015 that will allow you to switch up to £1,000 of your annual allowance to your spouse. That could boost your income by £200.

He’s already announced an increase in the basic personal allowance to £10,000 per individual from next April that could give couples an extra £224 a year. With energy bill cuts of £50 and the scrapping of the proposed 2p a litre increase in motor fuel duty, you could save even more financial woe next year.

If any members of the family travel by train you’ll cheer at the news that rail-price increases will by capped at inflation, rather than inflation plus 1 per cent, as was previously planned. It means tickets will rise by 3.1 per cent rather than 4.1 per cent.

And if you have young kids under seven, they may be offered free school meals, which is estimated to be worth up to £400 a year.

Married, No Kids

The Chancellor’s announcement of new transferable tax allowances for married couples from 2015 could have been made for you.

Under the new plans you can hand £1,000 of your annual allowance to your spouse to make the most of it. The move could help you pocket an extra £200 a year.

If you regularly enjoy drives at the weekend as well as motoring to work, you’ll also be pleased at the scrapping of next year’s proposed 2p per litre rise in motor fuel duty.

If you prefer to let the train take the strain, the news that the planned January increase of 4.1 per cent to 3.1 per cent will be pleasing. The Chancellor has capped rises at inflation, scrapping the extra 1 per cent he had allowed.

Single Mother

Britain’s army of several million-strong single mums have been hit hard by both the benefit cuts and increases in the cost of living. Neither of these are going to get any easier any time soon, with the Chancellor announcing a very political cap on welfare spending to come into force from 2015.

What’s more, single mums won’t be able to benefit from the extra £1,000 being tacked onto the personal allowances of married couples and civil partners, which is part of the Conservative pledge to reward committed relationships.

However, there are some positives for single mums, particularly those who work. The Chancellor confirmed that free school meals will be introduced for under-7s and will save over £400 a year.

Meanwhile, mums looking to fill up their cars for the school run will no doubt be cheered by the scrapping of the planned 2p a litre increase in fuel duty. Since 2010, the Chancellor said scrapped or deferred fuel duty rises have saved motorists the equivalent of £11 each time they go to refuel.

Rich Nuclear Family

This group largely escapes scot-free from the Autumn Statement – provided they pay their taxes. The Chancellor outlined an ambitious target of recovering some £9bn from stamping out tax avoidance over the next five years by closing the much-fabled loopholes in the current system. 

Richer people who own a home coveted by overseas buyers may find it more difficult to sell, as from April 2015 non-UK residents selling property for a profit will have to pay capital against tax. This is bound to hit the buoyant property market.

Our rich nuclear family may benefit from the provision of an extra 30,000 university places in the UK, to be paid for by the Government’s controversial sale of the Student Loan book. 

Commuters will find they aren’t hit as hard as they once feared with fares now set to rise by inflation, cancelling a previous plan to put them up by 1 per cent above inflation. As a result, in January 2014 the average regulated ticket will now go up by 3.1 per cent, as opposed to the planned 4.1 per cent.

Workers able to put money aside will benefit from the planned changed to the Save As You Earn scheme – the maximum which can be put into one of these share schemes will rise from £250 to £500 from 2014.

Single Pensioner

The good news is that the cap on welfare spending announced by the Chancellor and to come into force in 2015, will not hit pensioners, they are specifically excluded. 

As expected, there will be a rise of 2.7 per cent in the state pension in April, this equates to £2.95 a week from £110.15 to £113.10 for a single pensioner. Pensioners benefit from the Government’s triple-lock system, this means that the state pension increase is the highest rate of inflation in September, average wage rises, or 2.5 per cent.

Crucially, for people with gaps in their employment history, perhaps due to illness or taking on caring responsibilities, there will be the option to make additional, voluntary National Insurance contributions, this should help more people qualify for a full state pension. 

This will particularly benefit women who tend on average to have a shorter employment history and as a result their state pension income tends to suffer.

Pensioner Couple

Energy takes a big slice of pensioner incomes than is the case with nearly any other group, and although they receive the winter fuel allowance the bill rises seen in the autumn have bitten deep.

Trailed before the Statement, the Government has outlined plans to change some of the green levies included in energy bills in order to reduce the pain of price rises.

These should take about £50 off the average household annual domestic dual-fuel bill, although prices for most pensioner households will still be higher than they were a year ago.

The couple may be cheered by a rising of the income tax personal allowance to £10,000 from next April until, that is, they remember that earlier in the Parliament the Coalition actually abolished the preferential tax allowance enjoyed by the over-65s.

However, unlike single pensioners, the couple will see a 2.7 per cent hike in their state pension, confirmed by the Chancellor. This is in advance of a new higher state pension to be introduced in 2016, which will also see the sweeping away of many means tested benefits for the elderly.

Unemployed

Out of work benefits will only rise by 1 per cent from next April – this is way below the rate of inflation and will be the second year in a row when the unemployed have suffered a real-terms cut in their entitlements. 

Perhaps even more disturbingly for some, the Chancellor stated that there would be a cap in welfare spending to begin in 2015, although jobseekers’ allowance is at the moment exempt.

The Chancellor talked of stopping the “culture of worklessness” and said he expected the number of jobs to increase by 400,000 over the next year. Earlier forecasts had been for negligible job growth.

For younger jobless people there was something though, with the Government committing to creating an extra 20,000 apprentices and issuing more start-up loans so those looking to strike out and work for themselves should find financing a little easier. 

Overall, unemployment is now forecast to fall from 7.6 per cent to 7 per cent by the start of 2015.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

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