Business leaders offer thoughts on ONS inflation data

Following this mornings ONS CPI Data, confirming it has hit 10.1%, here are some comments from personal finance experts below:

Businesses have to provide better support to employees

 
Chieu Cao, CEO of Mintago, said: “Inflation is soaring even higher and we have all come to accept that matters will get worse before they get better. Worryingly, with Mintago’s recent research revealing that with over two thirds (68%) of respondents haven’t received a pay rise in line with inflation, the situation is becoming desperate for many employees.

“Something needs to change. UK employers must accept some responsibility in helping their teams to regain financial stability – even if they cannot afford meaningful pay rises. To start with, employees must be given the tools, such as access to financial planning platforms or free financial advice, to better understand their finances. Similarly, pension dashboards which allow employees to manage their contributions more easily could also help them overcome short-term financial difficulties.

“Ultimately, there is no quick fix to the current financial situation and the issues that are causing the cost-of-living crisis will remain in place for some time. That said, aside from pay rises, there are other ways in which employers can better support their employees to ease the financial stress that many are under.”
 

Retirement U-turn as inflation eats into pension pots

 
Andrew Megson, executive chairman of My Pension Expert, said: “The power vacuum at the top of the UK’s political hierarchy will only add to the sense of unease as, week by week, inflation climbs higher and higher. This is a particular issue for retirees, for whom there is a very real risk that they will need to reverse their retirement decision and re-enter work.

“In fact, millions of over 60s have already ‘unretired’ in 2022. Meanwhile, hard-earned money sat in some pension pots will be losing value in real terms as prices around us rise so sharply. In many cases, this means retirees’ savings will not sustain the lifestyle they had planned, or at least not for as long as they intended.

“Concrete plans to tackle inflation and support retirees are needed, and fast. The Conservative leadership contest is an unwelcome distraction from this, but hopefully once it is settled, a strategy can be implemented. For one, I would like to see ministers work closely with regulatory bodies to ensure retirees know where to access affordable independent financial advice, so they can better understand their financial situation, and make any necessary adjustments to their retirement strategy. Without proper support structures, we could see ‘unretirement’ become increasingly common across the UK in the months to come.”
 

Households must double-down on money management

 
Richard Eagling, personal finance expert at NerdWallet, said: “Today’s inflation figures paint a bleak picture for millions of households across the UK, who will see their financial wellbeing further squeezed.

“Everyone will be impacted by the latest jump, but it will affect people in very different ways depending on their financial circumstances, commitments and lifestyles. Ultimately, each household or individual should do all they can to take control of their finances, make sound decisions on how they are managing their money, and find the best possible methods of dealing with the cost-of-living crisis.

“Price comparison sites could offer some solutions, allowing households to compare prices for a variety of necessities, from groceries to energy providers. For those who are struggling, it is important to remember that free support is available from debt charities such as StepChange and Citizen’s Advice.”