1. Effects of lower economic growth
The OBR has forecast lower economic growth in 2026, at 1.1% (down from the 1.4% forecast in November 2025). This would mean a slightly slower-growing economy than in 2025 – the official estimate is 1.3% growth last year. A figure of 1.1% means quite slow growth, although the UK economy has generally been quite sluggish since the Global Financial Crisis of 2008. Slow economic growth means slow wage growth.
For people’s day‑to‑day finances, growth at this level is unexciting – but, at least, the economy is expanding rather than shrinking. While this won’t lead to rapid jumps in average earnings or spending power, it does support a sense of stability – helpful for financial planning and long‑term goals.
2. Lower inflation outlook interrupted by global tensions
The OBR says inflation looks set to decline from 3.4% in 2025 to 2.3% this year, lower than the November forecast of 2.5% for 2026. Lower inflation usually means that the pressure on people’s budgets and day-to-day spending starts to lift. Interest rates may come down, which is good news if you have a mortgage.
However, subsequent developments may already have made the OBR’s inflation forecast out of date. The US attacks on Iran have led to Iranian counter-attacks that have sent the price of oil and gas soaring. That could mean higher inflation in general – which could mean higher interest rates. Reflecting this, yields on UK government bonds (known as ‘gilts’) have gone up, as investors have changed their expectations for interest rates
While these developments may feel distant, their impact is often felt quickly in daily life:
How global tensions affect personal finances
- Higher oil prices can push up petrol, home energy costs, and food prices.
- Rising transport and energy costs can trigger renewed inflation pressure.
- If inflation remains elevated, interest rates may stay higher for longer, pushing up mortgage rates and the cost of borrowing. Higher interest rates can also hit stock prices, by increasing the cost of corporate borrowing.
Although Reeves now has slightly more fiscal room, international events could still influence the decisions that need to be made. As a result, any changes UK households experience may reflect shifting international pressures rather than the Chancellor’s long-term plan.
3. No changes to pensions
The Chancellor deliberately opted for a low‑key approach in the Spring Statement, avoiding dramatic reforms or market‑moving announcements. In volatile conditions, this lack of surprise can itself be a policy tool, by helping to anchor expectations.
One area where silence was most notable was pensions. After a year marked by speculation about pension reform, the absence of any new updates offers short‑term stability.
This means the changes announced in previous Autumn Budgets still stands:
4. What the Spring Statement means for financial planning in 2026
Periods of uncertainty are not new – and clients don’t need to predict global events to protect their finances. What matters is building a resilient financial plan and reviewing it regularly.
Key financial planning actions for 2026
1. Review your household budget and build resilience
With energy and food prices vulnerable to spikes, now is a good time to:
- Check if your budget would still work if your circumstances changed unexpectedly – you can do this with your monthly spending
- Build up (or top up) your cash buffer or emergency fund
- Review high‑cost debt ahead of potential interest rate changes
2. Make the most of pension stability – while it lasts
Even without pension announcements, the rules remain active and evolving. Consider:
- Maximising annual allowances where possible
- Checking whether the removal of the Lifetime Allowance creates new ways to review your pension planning opportunities
- Revisiting retirement timelines and contribution strategies
3. Avoid emotional investment decisions
Markets often react sharply to geopolitical news, but short‑term movements rarely change long‑term investment fundamentals. A diversified portfolio – across regions, sectors and asset classes – remains one of the most effective ways for you to manage uncertainty.
4. Understand gilt market dynamics
Fewer long‑term government bonds are being issued, which is helping keep their prices up. But concerns about inflation – driven by higher oil prices – are pushing bond yields up and reducing the chances of interest rates being cut soon.
You may want to:
- Review your bond holdings, and check how much they might go up or down if interest rates change,
- Balance the need for income with the potential for rate‑driven price movements
5. Plan for uncertainty – it’s the only certainty
Economic forecasts offer guidance, not guarantees. A long‑term, structured plan helps clients stay confident even when conditions shift.
How Rathbones can support your financial planning
Rathbones helps clients navigate uncertainty with clarity and confidence. Our financial planners and investment specialists work with you to build resilience, plan for the long term, and stay aligned with your goals – whatever the headlines may bring.
Commenting on the Spring Statement, Faye Church, Senior Financial Planning Director at Rathbones said:
“It’s also worth remembering that economic forecasts are seldom right - they are frameworks, not promises. The best response for households is not to try to predict the next twist in global events, but to build resilience into their own finances. That means stress-testing budgets, maintaining a cash buffer where possible, and keeping investments diversified rather than reacting to every headline.”
If you would like to discuss how the Spring Statement 2026 affects your personal financial plan, please contact your Rathbones adviser or fill out our enquiry form below.
The full tax tables from the Autumn Budget are available here.
