It's A Bumpy Ride Right Now

As we hit mid March, it’s good to see the sunshine again but the finance news lately has not been quite so uplifting.

⬇️ Economic Contraction in January

The UK's economy experienced an unexpected contraction of 0.1% in January 2025, primarily due to a significant decline in factory output. This downturn underscores the fragility of the current economic climate and may influence future fiscal policies. ​The Bank of England will make the latest interest rate announcement next week on the 20th of March; the expectation is that they will remain cautious and keep it at 4.5%.

🇬🇧 Anticipated Welfare and Public Spending Reforms

Chancellor Rachel Reeves is preparing to deliver the Spring Statement on March 26, 2025, which is expected to address public finances, economic growth, and the ongoing cost of living crisis. Proposed measures include potential welfare spending cuts aimed at reallocating funds for increased defence spending. These anticipated reforms have sparked internal debates within the government. We will have to see what the detail of the proposals is to see what impact it may have on us mere mortals. a

🚗 Car Finance Mis-Selling Scandal

Millions of UK motorists may be entitled to compensation following a car finance mis-selling scandal involving discretionary commission arrangements between 2007 and 2021. The Financial Conduct Authority is progressing plans for a compensation scheme, with potential payouts averaging £1,100 per affected individual. Borrowers are advised to lodge complaints and seek redress for any overcharges - see the end of this letter to find out what to do.

💷 Good News for Nationwide Members (thanks to my mum for telling me to keep this account!!!)

Nationwide Building Society has announced a one-off £50 bonus payment to 12 million members as a token of appreciation following its acquisition of Virgin Money. Eligible customers have been notified via email, with payments expected to be credited by April 30, 2025. This initiative reflects Nationwide's commitment to rewarding its members amid the evolving financial landscape.

Key Articles I Have Read This Week:

• Money Week dives deeper into Gold and if it’s a good time to invest in it. We’ve seen from my regular market updates how well it has performed over the last couple of years: Read it here

• BBC look at the latest news on the UK economy: Read it here

Investment Markets This Week:

Best Cash Savings Rates This Week

🌥️ Stay Calm, It’s Magic Money 🪄 

Any of you who I have had the pleasure of coaching, will know that we spend a chunk of time talking about how money and our emotions are intertwined. Understanding your emotional reaction to money, what level of risk you are comfortable with and have a clear goal for each part of your financial puzzle, is the skill set that will allow you to ride out market volatility, without panic and stay on track.

If you’ve logged on to your pension/investments in the last few weeks, it’s not been a pretty picture. Make sure you take a breathe and assess how this actually impacts your long term goals. It’s ‘Magic Money’ until you panic and sell to cash!

If you want to review your holdings and understand how they fit in to your financial plan better, why not reach out and see how financial coaching can help 🆘 Cick Here