Interest rate worries continue with unemployment falling……

At Enable our IFA’s can see that many are concerned about the possible rise of interest rates that were promised with the falling of unemployment.. But will the Bank really raise rates?  One thing to bear in mind is that despite falling unemployment it would seem that No 10’s figures do not include the self-employed, the big fall in joblessness seen last week, which the Government hailed as evidence of its economic success, was in fact driven a lot by people becoming self-employed.  About 40 per cent of the rise in employment since the worst points in 2009 has come from people being self-employed. So figures that do not include an estimate of their earnings do not give a full picture.

Many economists agree however that even if the Government is being optimistic, wages are closing the gap with the cost of living and it is quite possible that in the latter half of this year pay rises will beat inflation. Unfortunately that does not mean we are all going to be better off as that promised interest a rate rise might come sooner than expected.  It is worth taking note of economist and former Monetary Policy Committee member Andrew Sentance who argues that we need to start raising rates this year, though very slowly.

The difference being argued about over how much better or worse off we might be is a few hundred pounds a year but that can make a real difference in many households.  Even if we do not expect one this year, we should prepare for when it finally comes.  Enable IFA’s can help you get your finances in the best shape for your household.

Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE