Hey Juno community!
This week we're talking UK inflation (yes, we're sick of it too!), energy prices, and how to make the most of rising interest rates.
Plus, we're holding a free webinar next week on making your first investment – don't miss out!
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In the news this week...
1. UK inflation hits a 40 year high of 9.1%
What's happening?
Inflation has hit the highest level since 1982, and the Bank of England has warned that it looks set to keep on rising and may reach 11% later this year.
What does this mean for my money?
Annual wage growth has stalled at 4%, which means that inflation is outstripping most people's earnings. There's not really a positive takeaway here, it's just worth remembering that you'renot alone in experiencing the effects of inflation.
I want to learn more!
🎧 This BBC podcast from earlier this month explains what you can do if you're struggling with yourenergy bills.
2. The energy price cap is predicted to rise to £2980 this autumn
What's happening?
The energy price cap is the limit on what firms can charge for their default standard variable tariffs, and while it currently changes every 6 months, it's now set to change every 3. 70% of homes use the price cap, so it's likely that you're on it. Martin Lewis has estimated that this October the price cap will raise to £2980, higher than previously predicted.
What does this mean for my money?
One option is to switch to a fixed price energy tariff, where you pay a pre-determined amount over a period of time. Because of the rise on the energy cap, this is increasingly a potentially cheaper option.
I want to learn more!
🤓 Money Saving Expert has a deep dive on why you might want to change how you pay your bills.
3. Interest rates keep on rising
What's happening?
Interest rates are often used as a way to control inflation, so it makes sense that they're rising now. The cost of borrowing rises, but it also makes saving money more appealing as the interest rates on yoursavings become higher. Currently the interest rate is 1.25%, but could rise to as high as 3.5% (depending on who you ask!).
What does this mean for my money?
If you have a mortgage, interest on it will be going up – so you can compare it to cheaper deals and see if you can get it fixed. You should also check whether or not your savings account has high enough interest – ideally you should be earning at least 1.5%,
I want to learn more!
🏡 Use these tools to compare yourmortgage and yoursavings account.
What's going on in the community?
1. Is it better to move company or go for stability?
Q: I've just started a role two months ago in a great company with good pay and benefits, however the role hasn't really turned out to be what I expected it to be. I turned down a promotion at my previous company which would have paid me more but I didn't like the atmosphere or the way the company operated (as a queer person it didn't feel safe for me!).
My new role isn't really what I expected and I just feel myself feeling frustrated and unmotivated. I'm unsure of whether take advantage of the market while it's still hot for my sector or to stick the role out a bit longer to see if things improve?
Community member Natalia shared some amazing tips on what you can do to build your credit score.
"I had an issue with not enough info because I lived in UK for less than 3 years. Few things I did to build up my credit score:
Make sure you are registered on the electoral roll and keep it updated when you move.
Make sure you are paying some energy - you are the person that your electricity or water bill is tied to (this shows a track record of paying on time so make sure to pay on time).
Make sure you have a bank account with a well known bank (I had only monzo for ages but they don't refer to all agencies).
I got a usual phone contract - I used to use giffgaff which again doesn't create a trace for your credit score so getting a classic EE contract was a way for me to show that I can pay on time consistently (I had to pay a deposit at first that they returned to me after few months of paying on time).
Look into credit builder card first, these are intended for people who have bad or insufficient credit score to build it up. They will often get approved much more easily but have really high APR so you should only get it when you will return the money ASAP to not end up paying insane fees. I got Aqua for this but there are others as well.
Make sure you keep your addresses up to date on all accounts.
Good luck to you, it takes a while to build your credit score and it's a super annoying process but you can do it!"
We've also got lessons on building your credit score over in the YourJuno app – download it now if you haven't already 👀