Eight money and Cost of Living changes coming in May - starting from today

James Rodger
·5-min read

Eight money and Cost of Living changes hitting bank accounts, wallets and purses in May 2024 have been revealed. New changes come into force this month - affecting Department for Work and Pensions (DWP) claimants, Universal Credit recipients and more.

People who receive Universal Credit, Personal Independence Payments (PIP), Employment and Support Allowance (ESA) and other regular financial support from DWP usually see the cash land in their accounts on a regular basis and know exactly when the money should arrive.

But sometimes payment dates have to move and this is because the DWP does not issue payments on bank holidays, and there are a few of these falling next month. May has two bank holidays and it won't be the only financial change households feel this month.

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Probate fees hiked

Probate fees are to to be hiked 10 per cent to £300, as families wait nearly more than three months on average for this vital step to be completed after a bereavement. The average application time is little changed in recent months at 13.7 weeks.

"It’s a bit of a lottery how long any particular application now takes before the probate is granted," says Jo Summers, a spokesperson for the STEP organisation for inheritance professionals, who gave evidence and suggestions for improvements to MPs at a recent hearing.

"More complex applications, particularly those done on paper, definitely take longer than the simpler digital applications. However, you can also send two similar applications at the same time and one takes far longer than the other. 'There is no certain answer we can give people when they ask us how long the process will take."

Benefit payment date changes

This year, the early May bank holiday falls on Monday, May 6, while the later May bank holiday falls on Monday, May 27. Payments due on May 6 should instead land in bank accounts on Friday, May 3, while those due on May 27 should arrive on Friday, May 24.

Natwest to start closing Buy Now, Pay Later accounts

The bank, with over 18m users, is set to begin closing BNPL customers’ accounts from May 7 this year, according to a report from The Sun. The decision has been made due to lower than expected use of the offering, which was initially launched to much fanfare.

Speaking on the news, a NatWest spokesperson told Finextra: “We are focusing on our core lending products, helping customers spread the cost of their purchases through our credit cards, overdrafts and loans. This means our Buy Now Pay Later proposition will be closing.”

Interest rate decision

Inflation is now showing signs of coming under control, though it is still above the government's 2% target. In March, the Consumer Price Index (CPI) reading came in at 3.2%, down from a peak of 11.1% in October 2022.

There is an expectation that the Bank of England will cut the base rate this year as inflation slows, however, markets have recently adjusted to price in a "higher for longer" scenario.

The Bank of England’s Monetary Policy Committee meets eight times a year to set the base rate. This takes place roughly every six weeks. The next meeting is May 9.

Extra childcare help open for applications

If your child is 2 years old, you may be able to get 15 hours free childcare per week for 38 weeks of the year (during school term time). From September 2024, you'll be able to get 15 hours free childcare for your child from the age of 9 months if you're working. You can apply from 12 May.

If your child is 3 to 4 years old, you may be able to get 30 hours free childcare per week for 38 weeks of the year (during school term time). You may be able to get free childcare for up to 52 weeks a year by choosing to take fewer hours over more weeks. Check with your childcare provider to find out if this is something they offer.

Earnings threshold change for Universal Credit

The Government has laid regulations to amend Regulation 99 (6) of the Universal Credit Regulations 2013 to raise the Administrative Earnings Threshold level to £892 for individual claimants and £1437 for couples in Great Britain, from 13 May 2024.

Work and Pensions Secretary Mel Stride said: “I believe our welfare system is about far more than benefit payments; it is about changing lives for the better. That is why we’re bringing forward the next generation of welfare reforms.

"We’ve already overhauled the outdated benefit system by introducing Universal Credit, and now we are building a new welfare settlement for Britain – one where no one gets left behind."

Santander to cut interest rate

Santander is to cut rate on popular 5.2% easy-access saver. Santander is cutting the rate on its popular easy-access savings account from 5.2% to 4.2% on 20 May 2024. The rate cut applies to Santander's 'Easy Access Saver Limited Edition (Issue 3)', which is no longer open to newbies.

The rate cut applies to Santander's 'Easy Access Saver Limited Edition (Issue 3)', which is no longer open to newbies.

Energy price cap announcement

The next quarterly price cap announcement will be on 28 May 2024 and will cover what energy suppliers can charge between 1 July to 30 September 2024. According to the energy consultancy Cornwall Insight, the Ofgem energy price cap is due to fall again in July.

The firm, which has accurately predicted changes to the cap throughout the energy crisis, expects May's announcement to see a 7.7% (£130) fall in the cap. The annual figure is forecast to be £1,560. It then anticipates the cap will rise by 4.5% (£71) in October.

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