Money, in brief

The IRS, the US tax agency, set new income tax brackets for 2027 on Thursday. [1] A bracket is a band of income taxed at one rate. [1]

The income limits of the brackets rise by an average of 3.2% on 1 January. [2]

The 7 rates stay at 10%, 12%, 22%, 24%, 32%, 35% and 37%. [3]

The standard deduction, a set amount taken off income before tax, rises to $16,600 for a single filer. [2]

The change reaches over 160 million US taxpayers. [2] It applies to income earned in 2027, and most will file those returns in early 2028. [2]

Without yearly changes, a pay rise that only matches prices could push a worker into a higher band. [3]

With them, most people can shield more of their income from higher rates next year. [2]

Public finance calls the problem bracket creep: pay follows prices, so a larger share lands in higher-rate bands. [2]

A couple with $104,050 of taxable income stays at 12% or below in 2027. [5] At 2026's limit of $100,800, the rest would pay more. [5]

A ride lets small children in free below a height line. If the line never moves, every child grows past it and starts paying.

US consumer prices rose 3.7% in the year to September. [1] The limits rise 3.2%, and they follow a different index, the chained one. [2]

The $281 saving assumes nothing else changes. [2] Kiplinger, a US personal finance publisher, notes that higher limits do not always mean a lower bill. [3]

Returns for 2026, filed in the coming tax season, still use the 2026 limits. [3] The new limits first appear on returns filed in early 2028. [2]

The IRS moved US tax bands up 3.2% so that pay rises matching prices are not taxed at higher rates. [2]

A change like this can feel like a raise, because the tax bill falls, even though it exists to keep up with prices. [2]

Part of their income stays at 12% instead of falling into the next band up. [5]

Mark Zandi, chief economist at Moody's Analytics, estimates the Iran war has cost the average US household nearly $2,000. [7]

About $1,100 of that is higher energy and transport costs. [7] Higher interest rates and a share of military spending make up the rest. [7]

Across the US that comes to $265 billion, Zandi wrote on 12 October. [7]

In June the same economist put the cost at $1,000 for the typical US household. [19]

The war began on 28 February, when the US and Israel struck Iran. [7]

Gilbert Metcalf, a former US Treasury official now at MIT, says new strikes make attacks on oil shipping likelier. [7]

Metcalf says oil will stay high on that risk, just as US homes need oil and gas for winter heating. [7]

Economists call this cost pass-through: a firm that pays more for fuel raises its own prices. [20]

Diesel carries goods, Zandi says, so dearer diesel reaches the grocery till. [20] Jet fuel reaches air fares the same way. [20]

When a school bus costs more to run, the trip money asked of every family goes up too.

The figure is one economist's sum, and he calls it a bit of an accounting exercise. [20] It includes taxpayer-funded military costs, not only prices in shops. [19]

Whether the war's cost to US homes keeps climbing.

Zandi's figure counts the cost so far, and Metcalf says new strikes could keep oil high this winter. [7]

UK energy minister Polly Billington told the biggest suppliers on Thursday to do more about unpaid bills, the Guardian reports. [21]

Household energy debt could reach £7bn by the end of the year. [21]

The UK government plans to spend almost £2.5bn paying down the debts of about 2.4m households. [21]

Suppliers are expected to find struggling customers early and offer payment plans or debt advice. [21]

About 40% of unpaid bills are understood to build up when people move home. [21] Landlords would have to give suppliers meter readings and moving dates. [21]

The Bank of England's forecasts indicate a typical energy bill rising 27% in January, to £2,150 a year. [8]

With bills due to rise in January, Citizens Advice, a UK charity, says the plan must also stop new debts. [21]

Economists call this a cross-subsidy: what some customers cannot pay is added to everyone else's price. [21]

The average UK household pays about £50 a year for other people's unpaid bills. [21] That share would likely rise if the debt keeps growing. [21]

When a few friends skip paying for a shared meal, the rest split a bigger bill.

The saving of about £130 per household over 10 years is the UK government's own belief, and an average. [21]

The 2020s are set to be the worst decade on record for UK living standards, the Resolution Foundation says. [22]

The foundation is a UK research group. [22] It expects typical non-pensioner household incomes to fall 3% over the next 2 years, a drop of over £1,000. [22]

Its measure counts income after housing costs. [22] Those costs rise as homes with mortgages keep moving on to higher rates. [22]

The UK's official forecaster expects average mortgage rates to climb from about 4% in 2026 to 4.5% in 2028. [22]

Living standards fall right across the income range, the foundation finds. [22] The second-poorest twentieth may lose about 8%, and the richest twentieth lose most. [22]

A fall of that size bites far harder on a family with no savings, the foundation says. [22]

Statisticians call it mean against median: the mean is an average, and the median is the home in the middle. [22]

On the foundation's reading, almost all growth in the official forecast is not pay. [22] The cash part, interest and dividends, goes disproportionately to richer, older homes. [22]

If one rich pupil joins a class, average pocket money jumps, yet the pupil in the middle gets nothing more.

The official measure counts things no family holds as cash, such as the rent homeowners notionally pay themselves. [22]

The US child tax credit rises from $2,200 in 2026 to $2,300 per child for 2027, Money magazine reports. [2]

A tax credit cuts the tax a person owes. [23] This one has a part that families can get even when they owe no tax. [2]

That part rises from $1,700 to $1,800 per child. [2]

The earned income tax credit also rises. [1] To claim it, a person must have earnings and stay under income limits. [24]

With 3 or more children, its top amount goes from $8,231 to $8,496. [2]

A family owing no tax can get at most $1,800 of the $2,300. [2] Only a family with enough tax to cut gets it all. [2]

Public finance calls the $1,800 part refundable: it is paid even when the credit is larger than the tax owed. [2]

A voucher that gives no change is worth less to someone buying something small.

Why taking $1,000 off income is not the same as taking $1,000 off the tax bill

A deduction takes money off the income that gets taxed

What it saves is that money times your top rate

So $1,000 off saves $120 at 12% and $350 at 35%

A credit comes off the tax bill itself, so $1,000 saves $1,000

A nonrefundable credit stops when the bill reaches zero

A refundable credit or a direct deposit pays out anyway

A $1,000 deduction saves a 12% taxpayer $120 and a 35% taxpayer $350. A credit that stops at zero gives nothing to someone who owes no tax.

What $1,000 off is worth. The $1,000 is made up for the picture; the 3 rates are real US rates.

A family owing no tax can get only the refundable $1,800 per child, because the rest needs a tax bill to cut.

The old credit stopped at zero, so the new one is deposited in the account, and owing no tax no longer blocks it.

It is nonrefundable, so it reaches only a giver with enough tax to cut.

It is a deduction, so what the couple saves depends on the top rate they pay.

A bigger saving per dollar is not the whole story: income limits can shrink a break as income rises, as they do with the US bonus deduction for over-65s.

A tax law is written once, and each household meets it from its own income.

The average 30-year US home loan rate fell to 7.18% in the week to 5 November, Freddie Mac says. [11]

Freddie Mac is a big US mortgage firm. [11] Its rate was 7.24% a week earlier, and 6.22% a year ago. [11]

Rates briefly dipped below 6% in February, before the Iran war began. [13]

With Democrats running the US Congress and Republicans the White House, big spending bills could stall. [25]

Traders put the odds of a US central bank rate rise on 8-9 December at more than 80%, NerdWallet reports. [25]

Friday's US jobs report comes next. [11] A strong one could lift rates again, warns Hannah Jones, an economist at Realtor.com. [11]

Rates above 7% are still keeping many buyers out of the market, Realtor.com says. [11]

In finance, the return a bond pays a new buyer is its yield. [25] US home loan rates closely track the 10-year government bond's yield. [11]

If a stalled US Congress spends less, the US government may borrow less. [25] Fewer bonds for sale can ease yields, and home loan rates with them. [25]

When only a few stalls sell lemonade, none of them needs to offer extras to win a customer.

Jones says it is too early to tell whether the election's result will show up in the housing market. [11]

They bid against cash offers while paying rates above 7%. [13][11]

Signed US home sales fell 0.6% in a week, to the lowest in Redfin's records back to 2021. [12] Redfin is a US home listings firm. [12]

The median sale price was $388,604 in the 4 weeks to 1 November, down 0.4% from a year earlier. [12]

That is the third week of falls after 3 years of increases. [12]

The median monthly payment fell to $2,777, from a peak of $2,811 in early October. [12]

New listings fell 1.5% in a week, to the lowest since January. [12]

The buyers still looking may be able to talk prices down or win other concessions. [12]

Economists call this excess supply: more homes on offer than buyers at today's prices. [12]

There are 2.1% more homes on the market than a year ago. [12] They are taking a bit longer to sell. [12]

At the end of a school fair, unsold cakes get marked down because few buyers are left.

The median payment is still 11.1% higher than a year ago, so a lower price has not made buying cheaper. [12]

The median monthly US home loan payment fell to $2,777, a 5-week low, from $2,811 in early October.

Chuck Schumer, Democratic leader in the US Senate, said on Thursday his party must lower costs to keep its power. [26]

Democrats won both chambers of the US Congress on Tuesday. [26] Schumer named ending the Iran war and stopping tariffs, or import taxes, as 2 ways to cut costs. [26]

Illinois governor JB Pritzker named medical and student debt as issues for the US government. [26]

US Senator Bernie Sanders called for a national 5% wealth tax. [26] He says it could fund 7 million affordable homes. [26]

House Democrats meet next week to lay out their agenda, says Hakeem Jeffries, likely the next House speaker. [26]

A $2,000 monthly payment bought a home $33,600 cheaper in October than a year earlier, Realtor.com calculates. [26] Loan rates went from 6.05% in February to 7.33%. [26]

Political scientists call this a veto point: one place where a single actor can stop a law. [27]

Democrats lack the votes to override a Trump veto. [26] So a major tax bill would need common ground with Republicans. [27]

If one friend can cancel the trip, the plan has to suit that friend too.

What Democrats will actually put into a bill on costs.

So far there are speeches, and House Democrats meet next week to set an agenda. [26]

A record 10% of first-time US home buyers paid all cash in the year to June, an industry survey says. [13]

The survey is by the National Association of Realtors, the US estate agents' body. [13] It found 10% used an inheritance, a record. [13]

All-cash first-time buyers were about 3 times likelier to use one: 28% against 9%. [13]

The median first-time buyer is 40, level with the record high. [13] Cash buyers are older, at 54. [13]

First-time buyers rose to 22% of sales, from an all-time low of 21%. [13] That is still about half the old norm of 40%. [13]

Family money is changing who can buy a first home and when, says Jessica Lautz of the association. [13]

Economists call this an intergenerational transfer: wealth passing from one generation to the next. [13]

People are living longer, so the money reaches children in middle age, Lautz says. [13] That fits cash buyers' median age of 54. [13]

A bike handed down only when an older sister stops riding reaches the younger child late.

The vast majority of first-time buyers still borrow, says Hannah Jones of Realtor.com. [13]

Sellers often favour cash offers, because they carry no risk of a loan falling through. [13]

The BBC found 12 English universities gave student loan examples only on below-average pay. [16] The UK average is £39,039. [16]

Northumbria University said £75 a month was less than the cost of a daily coffee. [16] It removed that line after the BBC asked. [16]

Plan 5 loans, taken by students in England now, take 9% of earnings over £25,000. [16] Repayments run for 40 years or until the loan is cleared. [16]

At £30,000 a graduate repays £37.50 a month. [16] At £100,000 it is £562.50. [16]

Dame Meg Hillier, who chairs the UK Parliament's Treasury Committee, called some of it misleading. [16]

The UK Department for Education says it will review the information it gives. [16]

Megan Russon, a new tax accountant on about £29,000, repays about £30 a month. [16] At the £50,000 she expects, it becomes about £187. [16]

Behavioural economists call it anchoring: the first number a person sees sets what feels normal. [16]

An example at £35,000 makes £75 look like the price. [16] But 9% applies to every extra pound over £25,000, for decades. [16]

A phone deal advertised at its first month's price feels cheap until the later months arrive.

Northumbria says £35,000 is about average for full-time work in north-east England. [16] The Open University says its examples match its own students' likely pay. [16]

They were shown a low monthly figure, and their repayment grows with every pay rise above £25,000. [16]

All 4 English universities the BBC found giving wrong student loan facts have corrected their websites.

Sheila Williams of East Sussex, England, has taken a winter waitressing job to pay for heating oil. [9]

She says her oil bill has doubled since the start of 2026. [9]

Filling a 1,000-litre tank could now cost more than £970. [9]

Thousands of Sussex homes have no gas mains connection and rely on oil. [9]

Nigel Wanstall of Sheffield Park says he cannot fill his tank. [9] He uses an open fire and an electric blanket. [9]

Jon Reardon of Rye Oil, which supplies 15,000 residents, says many customers hold off ordering as long as possible. [9]

The UK government says it has pledged £53m and removed a 4% tariff on home heating oil. [9]

Energy minister Polly Billington told Parliament on Wednesday that UK ministers are working to regulate the sector. [9]

Reardon says oil has doubled on average since the war began, and that has hit his sales. [9]

Economists call a good inelastic when people keep buying it as its price rises, because they lack a substitute. [9]

A home with no gas mains cannot easily switch fuel. [9] So Williams added work rather than stop buying oil. [9]

School shoes still get bought when the price goes up, because a child cannot go without.

They have no cheaper fuel to switch to when oil doubles, so they pay it or go cold. [9]

How far £53m goes for UK homes on heating oil.

The UK government gives the total pledged, and the BBC report does not say how many homes it covers. [9]

Xyra Group, a London firm, has bid for Poundland, the UK discount chain, the BBC reports. [17]

Poundland's owner, the US firm Gordon Brothers, had already rejected a bid from Martin Property Group, an Irish firm. [17]

Gordon Brothers bought Poundland for £1 last June. [17]

Business secretary Jonathan Reynolds held talks with the owner, urging it to protect staff. [17] It promised to put offers that protect shops and workers first. [17]

It is unclear whether Xyra would keep the chain whole or break it up. [17]

Poundland has 12,000 staff. [17] Founder Steve Smith says up to 30,000 people could be affected in a collapse. [17]

Finance calls this due diligence: checking a buyer's money and plans before trusting a bid. [17]

Gordon Brothers' tests include whether Xyra has the money and would be a good long-term owner. [17] The BBC says little shows Xyra meets them. [17]

Someone selling a bike online asks to see the money before handing it over.

Judith MacKenzie of Downing Fund Managers says there is "hardly any information" publicly available on Xyra. [17]

The BBC reports an offer to pay half the debts at once. [17] Its sources also say £12.5m of a £30m loan, which is less than half. [17]

Those who work only for the chain could go under with it. [17]

Whether Xyra has the money to buy Poundland.

One fund manager could find no evidence that it does, and the BBC says little shows it meets the owner's tests. [17]

From 2027 the US government will match savings for retirement, up to 50% of the first $2,000, for lower earners. [23]

So a saver who puts in $2,000 can get up to $1,000 more. [23] The money goes straight into the retirement account. [23]

A married couple earning up to $41,000 gets the full match. [23] Part matches run up to $70,999. [23]

A single filer gets the full match on earnings up to $20,500. [23]