A number of important money changes are coming in the new year, impacting the finances of millions of households across the UK. DWP benefits and state pension rates will be affected, while household bills will be rising.
The start of a new year can always be an uncertain time when it comes to finances, so we’ve produced a list of some of the most important changes, what they mean and when they will happen.
Millions can expect their regular payments from the state to increase but some of the biggest bills will also be going up at the same time. These are some of the biggest money changes coming in 2025.
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Benefits
DWP benefits claimed by millions of Brits, such as Universal Credit, Personal Independence Payments (PIP) and Disability Living Allowance will all be increasing. State benefits will be going up by 1.7% in line with the inflation rate for September.
The increased payments will kick in from April. For a couple aged over 25, the monthly amount will rise from £617.60 to £628.10.
State pension
The state pension rate will also be increasing in 2025. The triple lock guarantee determines how much more pensioners will get each year.
The triple lock ensures the pension rate rises to match whatever is highest out of inflation, wage growth and 2.5%. This year the highest of those was wage growth at 4.1%.
The full state pension will rise from £221.20 a week to £230.25. For those on the old state pension, it will jump from £169.50 a week to £176.45. The new rates will start from April.
Minimum wage
The National Living Wage, for those aged over 21, is increasing from £11.44 to £12.21 from April, providing a boost to the finances of millions of the lowest paid workers. The minimum wage for those aged 18-20 will rise from £8.60 to £10.
Energy bills
Energy bills will be rising again from January. The typical household will pay £21 more on average under the latest rates set by the Energy Price Cap.
The price cap changes every three months so there will be new rates in April, July and October. Prices are not expected to fall significantly during 2025.
Council tax
Council tax is likely to increase for most households across the UK from April. It’s down to individual local authorities to set rates but the Government has given the green light to hike charges by up to 5%.
With many councils strapped for cash, large increases are expected across most of the country placing an added burden on households.