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Brexit: what are your financial concerns?

Brexit EU referendum flag

Last week the UK voted to leave the EU. Whatever your views on Brexit, it’s clear that we’re set for a period of uncertainty when it comes to our personal finances.

We’ve set out the main ways that the vote to leave the EU might affect your wallet, but it’s clear that definitive answers about what will happen may be hard to come by, at least in the short term.

Brexit and interest rates

Savers face uncertain times when it comes to their interest rates. The Bank of England (BoE) base rate has been stuck at a record low 0.5% since 2008, in order to encourage banks to lend and boost the economy. Now, with fears about a possible recession, the Bank may cut the rate to 0.25% or even 0%.

The Governor of the BoE, Mark Carney, stated in his speech on the morning after the referendum that the Bank would consider ‘any additional policy responses’. It’s thought that the first rate cut may happen in August, but this is purely speculation.

The logic of lower interest rates is to make it cheaper to borrow money, which in turn will make people more likely to spend, boosting the economy. This would mean more bad news for savers, but better news for homeowners and those in the market for a mortgage.

Beyond the immediate term, it’s possible that interest rates could start to rise, especially if inflation becomes a concern. It’s thought that inflation may become a problem as the result of a weaker British pound, which could lead to increased prices from the supermarket to the petrol pump.

Uncertain times for investors

Investors, including anyone with a pension invested in the stock market, face a period of uncertainty. And since stock markets hate uncertainty, investors should expect big swings in prices over the coming months.

The FTSE 100 index, which is made up of large, often multi-national companies with earnings around the world, fell substantially in the immediate aftermath of the referendum vote, although it has since bounced back to an extent. The FTSE 250, which is made up of mostly medium-sized and domestically-focused companies, fell more dramatically. At the time of writing the FTSE 250 has also recovered some ground, but is still down by more than 10% since the start of 2016.

However, long term investors with balanced portfolios should be well placed to ride out the storm. And if interest rates are cut you would usually expect shares to go up, all else being equal, as frustrated cash investors seek better returns from riskier assets. The Chancellor George Osborne, following Mark Carney’s lead, has sought to reassure the markets about the strength of the UK economy.

Homeowners post EU referendum

And homeowners may face a less rosy outlook than they’ve become accustomed to, with speculation about the impact the wider economic climate might have on the property market. It’s possible that the market will slow down, as buyers decide to wait and see what happens to asking prices. On the other hand, lower mortgage rates could stimulate demand.

Your Brexit concerns

Which? is committed to helping you with the difficult questions you might face following the UK’s vote to leave the EU. And as negotiations to leave the EU develop, we will work with the government to ensure that the consumer voice is heard and important rights are protected.

Our Which? Money Helpline experts have fielded some Brexit questions since the result of last week’s EU referendum. Some callers have been concerned about their pensions; others wanted to find out whether their savings were safe. We’ve also heard from concerned homebuyers.

We’ll be covering all these issues in Which? Money magazine and on Which.co.uk in the coming weeks and months. We also want to hear what you’re most concerned about here on Which? Conversation.

Will you be making any changes to your personal finances following the EU referendum results? Are there any consumer issues related to Brexit that are worrying you, whether personal finance or not?

Comments
Member

“The value of the pound is the biggest post-Brexit concern among Which? members, according to a new survey.

The value of their pension came next highest, with 71% expressing concern about it, while 68% were concerned about the value of their savings. The price of groceries, and losing the use of the European Health Insurance Card (both 63%) were also key concerns.

Read more: http://www.which.co.uk/news/2016/07/brexit-value-of-the-pound-tops-post-vote-fears-448605/ – Which?

Well, the majority voted for Brexit and there were plenty of “warnings” about the possible consequences of leaving. So I don’t think all these people can be that fearful, otherwise they would have voted to “remain”. Or maybe the survey sample of just Which? members was not representative?

Member

Which? (website 24/7) quotes a poll that says more people will stay put in their homes and improve them rather than move.

They go on to advise to think about the cost of home improvements – like a new bathroom or kitchen – that may not be reflected in any increased value of your home. This seems to perpetuate the notion of your home being primarily an investment, rather than a place to make as comfortable as you would like to live in. I’d suggest, unless you are moving, you spend the money necessary to turn your house into a home you will enjoy.

For my part I’d rather find a home that I can develop to suit my family rather than move unless a relocation was necessary. Saves a lot of money and stress.

Read more: which.co.uk/news/2016/07/brexit-10-of-people-now-more-likely-to-make-home-improvements-449070/ – Which?

Member

According to the German finance minister (I think it was) TTIP between the EU and the USA might well be dead in the water. Interviews in both camps seem to think that was likely, partly because the US is preoccupied with electioneering – and partly because of concerns about a decline in standards.

I think many here might breathe a sigh of relief, but also hope the UK doesn’t simply take it on board. A sensible trade deal that abolishes protective tariffs, upholds the higher standards of those involved, without interference in a country’s rights to organise its public services in their own national interest, would be the outcome I would like to see.

Member

Agreed malcolm , but they are going to sign (the EU ) the Canadian Trade Agreement -CETA and while America are not happy about the Canadian deal being without some measures , if you check up the US owns a lot of Canadian BB so the US are getting in by the backdoor. I also agree about TM not accepting TTIP , but knowing the behind the scenes US pressure she probably will , or is she as “iron ” as Maggie ?

Member

The High Court in London has ruled that the British Parliament does have the right to vote on whether or not to trigger the mechanism for Britain to leave the EU -3-11-2016–against the opinion of the government . Big news ! Big enough for another Convo on it ? and possible RE-emergence of “our Nigel ??

Member

Having the majority of those who voted possibly overruled by parliament does not seem like democracy in action. It seems to me the Government asked for our view, and should respect the outcome, as they were intending. I hope this does not go on for as long as the new runway saga.

Member

Malcolm you dont know half of the high pressure the UK government is under. I get emails from government type organisations telling me of the latest fight to stay in the EU and its isnt coming from radicals this is British powerful people both financially and politically . Add to that even more powerful bodies in the US who are angry at Brexit , we are talking “rulers ” if you know what I mean that “inform” HMG what they think , then you have the banks , I am talking WB/IMF level. I wasnt kidding about Nigel having to come out again.

Member

The EU is proposing a plan to let Brits “opt-in ” to keep their EU citizenship after Britain leaves the EU -IE- “associate citizenship ” -Amendment 882 . Now if this doesnt cause some reaction in the UK then our Nigel is sleeping , it will ,of coarse go down very well in Scotland / NI .

Member

I’m more interested in the effects on Brexit to the UK as a nation – particularly freedom from the bureaucracy and wastefulness of an “organisation” that has got too big to be effectively managed. It has nearly destroyed the economies of a number of states by its ill-advised handouts. I do not for one minute think the UK does not have bureaucracy and wastefulness but would rather have that accountable to us. At present the EU seems accountable to no one.

If individuals find ways to establish EU citizenship, to get freedom to work and set up businesses, use the healthcare system, them I’m OK with that. You can already do that by various means – Irish ancestry, purchase bonds in Cyprus, register in Estonia, marry an EU citizen for example. I think the EU is fearful of the way it’s growth beyond free trade and the original aims into a super state will be reacted to by more states. Forthcoming elections will be interesting.

Member

Latest news on the Brexit front from the UK High Court -ruling that the Scottish and Welsh governments CAN intervene in the Brexit process ,saying they have a say in the triggering of Article 50 , NS was seen to jump up and down in delight (just kidding on that bit ) . I can see a quick scrambling of documents of the 1707 Union of the Crowns ( Act of Union )

Member

Call King James the Sixth and the First . . .

Excuse me , My Lord, but the King is no longer with us.

Oh, I am sorry to hear that, is this a recent event? . . . nobody told me the King was ill and now I hear he is dead. This is very difficult as we are here to consider whether the First Minister of Scotland [in the red corner] can take a swipe at the Prime Minister of the United Kingdom [in the blue corner] and whether or not the honourable Parliament of this splendid Realm is entitled to poke its nose in. Tut, tut, . . . I was relying on the old King to help us settle this contentious issue in time for Christmas. I was hoping to cast off this mantle of being an enemy of the people which so upsets my good lady wife as it restricts her social life. Well, I shall have to continue as best I can. Is Mrs Sturgeon here?

Yes, My Lord, I am here and I represent the kinsfolk of Scotland from the lochs and the glens and even unto the bonny banks of the Clyde . . .

Yes, yes . . . I can hear you but I cannot see you, so would you kindly stand up when addressing the Court. Oh, you are . . . I am very sorry. That will be all for now. Is Mrs May here?

Yes, My Lord I am present and I have a large bundle of documents for you to peruse on the . . .

Oh, yes, Mrs May. That’s very good of you. I can see you quite clearly, and you are looking very smart and adroit if I might say so. The Court always appreciates it when witnesses have the relevant facts at their fingertips. Perhaps we shall be able to reach a satisfactory conclusion quite quickly now. I trust I hardly need to point out that, as this is the Supreme Court of Judicature, the proceedings will be conducted in English and not in accordance with Scottish law and precedents. I hope you agree that this will be most beneficial to the government and produce a favourable outcome. I think it is time for a brief adjournment while I attend to some procedural matters. Mrs Sturgeon, would you kindly accompany me to my room so that I can give you some helpful advice on the appropriate conduct in Court . . .

:: It goes on, and on, and on.

Member

Your better than any medicine I have ever taken in life John , puts a smile on my face on a Saturday.

Member

My simple brain struggles with the present situation. The UK voted to leave the EU. Article 50 enables us to tell the EU formally that is what we will be doing. So what is stopping us from carrying out the will of the people? The Government, having asked the question and got an answer, is there to carry out the wishes of the majority surely? That gives us a 2 year period in which to negotiate terms. I don’t see that as an unrealistic time. Lets just get on with it and get into the real world.

Member

It’s now January 2017 and I suppose that you are even more perplexed!
We seem to have rather forgotten the issue of sovereignty for which thank goodness as it has so little to do with the in/out question. In any agreement from single market to WTO there is some element of sharing of sovereignty with agreement on at least arbitration in the case of uncertainty/dispute.
The argument seems to be coming down to immigration. But nobody has spelled out how this much hyped “control” will be implemented. Will farmer bid against farmer to a new bureaucracy on the right to import vegetable pickers. Worse hospital against hospital to the same body for nurses.
Obviously that will not work. The only thing that will work will be a healthy (sic) dose of recession that will make the UK’s gig economy less attractive.
This I fear is what we might get along with the deregulation much favoured by Dr Fox et al. Again no real detail about which regulations would be scrapped.
Is this really what the 52% voted for? I am certain that they didn’t. I think that our status quo Brexit of no Schengen, no euro and rebate is exactly what is “in the best of interests of Britain” to quote Mrs May.
Am I wrong and, if so, how?

Member

Immigration is continually hyped by some as the main issue for leaving but it was not a factor in my vote. I wonder how many others felt the same. I am happy for people to have access to any country, including ours, providing they do not expect to be supported financially but look after themselves.

Member

In your November comment you wrote of getting “into the real world”.
I would really like to know what you mean by this.
What difference would we notice?

Member

The real world is where we come out of the bureaucratic umbrella of a Europe that tries to deal with a wide range of different nations problems that are probably impossible to reconcile, and into one where we deal with our own. We make our own trade arrangements, we decide our laws, immigration rules, decide on who we subsidise, our farming and fishing policy, who gets public contracts, and so on. What difference would we see? I don’t know but I don’t see a huge unwieldy European bureaucratic organisation with conflicting national interests as an efficient way of helping the UK. If we have real worth as a country we will make our own way in the world, hopefully with proper relations with all our European neighbours. I suspect we won’t be the first though to cause changes in the EU.

Member

“We make our own trade arrangements, we decide our laws, immigration rules, decide on who we subsidise, our farming and fishing policy, who gets public contracts, and so on. ”

The bit that you don’t mention is that if we were to “make our own trade arrangements” we enter into an agreement where we are bound by various terms and conditions. If we sign upto the “arrangement” then we agree to the terms.
So apart from the “immigration rules” (which you previously said was not a factor in your vote) then I wonder which of your other “real world” conditions would be much or any different from those now.
The big difference that I would expect will be the creation of a much increased UK bureaucracy to keep these various arrangements under surveillance.
We hear little of the “have our cake and eat it” jibe now but I wonder if somehow people intent on leaving the EU still believe that the agreements with the EU post Brexit will make us better off than we are now.
Before you tell me that we will also be free to make advantageous agreements with the US I suggest that you listen to the interview on yesterday’s Today programme with Simon Moore. It is here http://www.bbc.co.uk/programmes/b087qh9h listen from 1 hour 16 minutes in. Might this give you a few qualms about your optimism?

Member
irene lavin says:
14 December 2016

We voted to get out of the eu. And that is what we want, if the eu wants to play silly biggers so be it, i am sick and tired of all this stupid behaviour by so called mps and other gobshits the peole have spoken and it shall be so. If any one says other wise ,i did not vote for the mp who got in in my county , he was not voted 100 percent of the people.i say why should they be in goverment ,when not every one didn’t vote for them. Sick to death of what is going on. I did not vote for this government why should they be in goverment at all..we also didn’t vote for may, she says the words but isn’t for us she lies,camaron robbed us blind in government and on leaving.he is now getting millions for some nonsense job he’s doing with kids.he’ll be prancing around while volunteers will be doing the job. Get rid of him once and for all. Dump the robbing sod.