Be right on the money: four ways to fix your finances in 2025
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After a few years of financial shocks, our expert explains what to do now ensure your money is fit for the future. The past few years have taught us that it’s pretty hard to guess what financial shocks are around the corner, so all of this is written with the caveat that 2025 might not go as expected.
![[Hilary Osborne]](https://i.guim.co.uk/img/uploads/2018/06/04/Hilary_Osborne,_L.png?width=75&dpr=1&s=none&crop=none)
But assuming we face a bit of stability, we are looking ahead to a time when prices for groceries, energy, homewares and other daily spending will plateau or maybe even go down. Interest rates are expected to fall too, as the Bank of England stops worrying about inflation and attempts to put a bit of fuel back in the economy. All of this means there are some jobs to do with your finances:.
![[Legal minimum pension contributions are low – 8% of your earnings – and will not guarantee you a good retirement income.]](https://i.guim.co.uk/img/media/14a7590495a0f0b9c1a31dcd6bd0b59bfb02511d/0_82_4256_2555/master/4256.jpg?width=445&dpr=1&s=none&crop=none)
You have missed the peaks of the savings market, but may still be able to get a better deal on your deposits than you are now. Putting away your money for a fixed period of time will typically secure you a better interest rate than you will be offered on easy access accounts. Make sure you have enough you can get hold of if you need it in an emergency – a boiler or car breakdown, for example – and then look for a good rate on the rest.
Currently, you will get a better rate on a one-year fixed-rate account than a five-year account, because over the longer period the base rate is expected to fall further. You need to decide whether to take the higher rate and hope that in a year’s time you can get something like the current five-year rate, or whether you think taking a hit now will be worth it over the longer term. If you have enough money to meet the minimum deposits on different accounts, spreading your cash between them is a good way to hedge your bets.
