The Autumn Budget always grabs attention. This year’s, on 26 November, has sparked plenty of speculation about what it could mean for pensions, property and investing.
But what really matters for your money?
In this solo episode of Keep the Change, Tom Francis, Head of Personal Finance at Octopus Money, takes a look at the Autumn Budget rumours: what’s realistic, what’s just noise and how to prepare your finances before any changes land.
Don’t act on rumours
Budgets always come with speculation. The problem is, people often make decisions too early. Last year, rumours about changes to tax-free cash led some to withdraw from pensions unnecessarily: a decision that’s hard to undo.
Most Budget changes include a grace period, so there’s time to adjust. Don’t make big moves until you know what’s real.
Pensions and inheritance tax
One change is very likely coming in April 2027: pensions will count towards your estate for inheritance tax.
Right now, pensions usually sit outside that calculation, which can help reduce potential inheritance tax bills. From 2027, that will disappear for many people, especially those with estates over £1 million (including property).
The good news is there’s time to plan. Start reviewing your estate and pension arrangements now, so you can make informed decisions well before the 2027 deadline.
ISAs under review
Many people still keep their ISA savings in cash, a habit that’s increasing year on year. Rachel Reeves has hinted at wanting to change that, to get more money “working” through investment.
Possible changes include:
- Cutting the cash ISA allowance (possibly from £20,000 to £10,000 or lower)
- Creating a ‘British ISA’: an extra allowance for investing in UK companies
However, a British ISA could make the system more complicated and could limit diversification, so any changes are more likely to focus on the existing ISA rules rather than creating a brand-new type.
Again, don’t rush to move money. Wait for the details.
Wealth and property taxes
A wealth tax has been mentioned by the Conservative Party in early discussions about its future manifesto,, aimed at very high-net-worth individuals. But Tom explains it’s hard to implement: the wealthiest tend to be mobile and often have assets tied up in businesses, not cash.
A more likely option could be a property-based tax, a sort of “super council tax” on homes worth over £1 million. And while the current government hasn’t proposed scrapping stamp duty, Tom floated a possible alternative in the episode:
“What if, instead of paying stamp duty when you buy a home, there was a small capital gains tax when you sell? It could shift the cost from buying to selling and make getting on the ladder a bit easier.”
Pension tax relief
Every year, there’s talk of scrapping higher-rate pension tax relief and replacing it with a flat rate for everyone. It’s complicated, politically sensitive and unlikely to happen soon.
“If I had a pound for every time someone predicted changes to pension tax relief, I’d have about £10. It’s one of the most persistent rumours around, and for that reason, I think it’s unlikely,” says Tom.
Right now, higher-rate taxpayers still get 40-45% relief, and there’s no solid sign of that changing.
State pensions
The triple lock (which guarantees that the state pension rises by the higher of inflation, earnings or 2.5%) has become expensive for the government to maintain. With an ageing population, it’s under review again.
Expect noise, but any real changes would be gradual. The government knows how politically sensitive this is.
Market rumours and the “AI bubble”
Finally, there’s growing chatter about whether we’re in an AI bubble. Big tech firms like Nvidia have seen their valuations soar on AI optimism. But bubbles aren’t new. They’ve been part of investing for centuries, and the investors who do best are the ones who stick to good habits rather than chasing trends.
The key is how you manage through them:
- Keep an emergency fund of 3-6 months’ expenses
- Invest for the long term (ideally five years or more) so you can ride out short term changes
- Check your risk level. If AI is part of a diversified portfolio, you don’t need to panic if markets fluctuate
What to do now
Budgets come and go. The best thing you can do is keep your plan steady and review it regularly. Check:
- Your pension and estate plans still make sense
- You’re using your ISA allowance efficiently
- You’re not holding more cash than you need
And if you’re investing, keep your basics covered: have an emergency fund, invest for at least five years, and stay diversified.
The headlines will move fast, but your goals shouldn’t.
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This article is for general information only and does not constitute personal advice. The value of investments and any income derived from them can fall as well as rise. You may get back less than you invest. Tax treatment depends on individual circumstances and may change in the future.
