Cost of living: 7 money changes to be aware of in September 2023 including Universal Credit shake-up
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September 2023 is upon us and with it comes a number of financial changes it’s worth noting down in your diary. This month we’ll see changes to Universal Credit along with student loans for people starting University in England this year.
There will be a shake-up for Amazon Prime members and it could be time to make a meter reading as the end of the current Ofgem price cap looms. There will also be the usual inflation and Bank of England interest rate announcements.
Here are 7 money changes to be aware of this month.
Student loans shake-up - for students starting university in September
There are three changes affecting student loans in England from Septemer 2023. First of all, new students will start repaying their student loans when they earn above £25,000 under the Plan 5 loan. Currently, graduates only start repaying when they earn above £27,295 on a Plan 2 loan.
New students will also see their loan wiped after 40 years, instead of 30 years, unless they pay it all off before this time. It means most students will spend an extra ten years paying off their loan. The final change will see the interest charged at just the rate of Retail Price Index (RPI) inflation, instead of inflation plus 3 per cent.
Universal Credit changes - throughout September
In September the “managed migration” process of switching people on older benefits over to Universal Credit will be expanded to all regions of the UK. The Department for Work and Pensions (DWP) has been targeting different areas on a monthly basis, with a focus on Tax Credit claimants.
The DWP hopes to have most people moved across to Universal Credit by the end of the 2024/25 financial year. Around 800,000 Employment and Support claimants have a longer deadline of 2028/29.
September 1: PayPal increases its interest rates
PayPal is set to start charging more interest to those who use its PayPal Credit service from Friday, September 1. Users are typically charged three different rates of interest depending on their individual circumstances - 21.9%, 25.9% or 29.9% - but PayPal is increasing the lowest rate to 23.9% APR.
September 18: Amazon hike for Prime members
Amazon will start charging Prime members for same-day delivery for orders under £20 from Septemer 18. If your order is under this amount, you’ll be charged £1.99 for same-day delivery. All items eligible for Prime qualify for free delivery currently - if same-day delivery is available, you normally need to place your order before midday to get your package by 10pm.
Amazon Prime costs £8.99 a month or £95 for a year’s subscription.
September 20: Inflation announcement
On September 20 the Office for National Statistics (ONS) will release the inflation rate for the 12 months to August. Consumer Price Index (CPI) inflation is a figure used to explain how much the prices of goods and services have increased over time.
September 21: Interest rates decision
On September 31 the Bank of England will announce whether interest rates will be increased again. The central bank increased the base rate to 5.25% in early August. The base rate is what the Bank of England charges other banks and lenders, which in turn then influences the rates you are charged as a customer when you borrow money.
September 30: Take a meter reading
The Ofgem price cap is set to fall from £2,074 a year to £1,923 for a typical dual fuel household paying by direct debit on October 1. It’s worth taking a meter reading before the new price cap begins, if you don’t have a smart meter.
Taking a meter reading at this time means your supplier won’t estimate your usage and potentially assume you’ve used more energy at the higher rate. You should do this as close to the new price cap coming in as possible, so September 30 is ideal - but it will be fine if you do it any time roughly around this date.