6 money changes to be aware of in May - and how they will affect you
In May there will be some huge financial changes and deadlines affecting Universal Credit, your Tesco Clubcard points and more.
The money changes come after April saw a huge increase in bills across the board as the cost of living crisis deepens.
Here we explain all the major financial changes and deadlines over the next four weeks and how they will affect you.
What are the financial changes in May?
Rise in interest rates
Interest rates are expected to increase from 0.75% to 1% this Thursday 5 May.
This increase would be the highest level for 13 years as the Bank of England is battling to decrease inflation which hit a new 30 year high in March of 7%.
Inflation is expected to reach 8% later this year.
The base rate is what the BoE charges other banks and lenders - this affects what you are charged if you borrow money, and how much interest you get back on your savings.
For those with a mortgage, if you have a fixed-rate deal then your rates won’t change if interest rates are hiked.
If you are on a tracker mortgage and interest rates are hiked, then your rates will go up as these move in line with the base rate.
Those who are on a standard variable rate (SVR) mortgage may see rates increase, as it’ll be down to your lender to decide whether to pass on the increase.
For savers, interest rate rises are generally good news as it means you could see a higher return on your money - if you have got a variable rate account.
However, there is no guarantee that banks and lenders will move in line with a potential hike.
Some also may take time to announce any changes.
Up to 2.6 million people on old-style legacy benefits are expected to move over to Universal Credit from 9 May.
This process had been paused due to Covid - but the Government wants everyone to be moved over by the end of 2024.
People will start getting a “migration notice” in the coming months.
There will be a three-month deadline to claim Universal Credit or you will have your benefits stopped.
Only around 500 people will be moved to Universal Credit at first, but the Department for Work and Pensions (DWP) will step up the pace after a few months.
Those being affected are benefit claimants who get the following payments:
Working Tax Credit
Child Tax Credit
Income-based Jobseeker’s Allowance
Income-related Employment and Support Allowance
If you claim the above benefits and want to move to Universal Credit straight away, you can ask to be moved over now.
But it is advised to do your research first.
Officials say 55% will be better off on the Universal Credit, but some will be worse off in the long term.
You can’t move back to the old-style benefits once you’re on Universal Credit.
You can use an online benefits calculator from charities such as Turn2Us and EntitledTo to see how the change will affect you.
Council tax rebates
Council tax rebates worth £150 started dropping into the bank accounts of thousands of eligible households from last month.
However, not everyone has received the payment yet.
Some households face waiting months for the £150 to land in their account, even until September.
Councils officially have until 30 September to issue the money.
Some councils are expecting payments to start in May.
Those who pay their council tax by Direct Debit will receive the payments first, as councils have their details on the system already.
The council tax rebate will apply to homes in council tax bands A, B, C or D in England and Wales - roughly 80% of properties.
It won’t apply to those who live in council tax bands E, F, G and H (or I as well, in Wales).
Scotland residents will also be entitled to £150 off if they are in bands A to D - and will also qualify if they’re currently getting a council tax reduction as well.
Sky price increases
Sky landline customers saw the cost of making a call with Sky Talk on a home phone rise by 10% from the beginning of May.
You now pay 22p per minute, up from 20p, to talk to family and friends.
This applies to Pay As You Talk customers making outgoing calls to mobile and home phone numbers.
International calls may be charged at different rates, depending on your tariff.
You may want to consider looking for a cheaper deal if you are not happy with the price increases.
You can compare prices online through Uswitch.com.
Another option is to consider haggling with Sky, if you don’t want to leave but want to lower your monthly bill.
Sky will also bring back EU roaming charges from 3 May.
This will cost £2 per day for holidaymakers who use mobile data, make calls and texts outside the UK.
Tesco shoppers have only a few weeks left to use £17 million worth of unspent Clubcard vouchers before they expire in May.
The supermarket said the vouchers must be used by 31 May 2022.
To get Tesco vouchers through its Clubcard loyalty scheme, customers have to build up points by spending money in stores.
Shoppers get one point for every £1 they spend in store and online, or one point for every £2 spent on fuel.
Voxi introduces EU roaming charges
Voxi, a sub-brand of Vodafone, is introducing mobile roaming charges for new and existing customers who holiday in Europe from 27 May.
Customers will need to purchase a European roaming pass to make calls, send texts and use data in 49 European countries and destinations.
The roaming passes cost:
£2 for a one-day pass
£4 for a two-day pass
£8 for a eight-day pass
£15 for a 15-day pass
The roaming passes will also include unlimited texts and minutes, even if that’s not what your UK Sim usually offers.