The Money Brief #13 - 13 July 2026

Two numbers this week. The first is £35,567: what a typical two-adult household now needs each year just to cover the bare essentials. The second is £41,550: what I still owe on the student loan I took out ten years ago at £34,730, after a decade of repayments. This week is about what it costs to live here, and what it costs to get ahead. Grab your Monday morning coffee. Let me translate.

Two stories about university collided this week, and together they ask a question a generation has been quietly asking for years: was it worth it?

First, the official one. On Tuesday, a committee of MPs (the Treasury Select Committee) published a report concluding that the government mis-sold student loans to more than five million people. Their words, not ours. The committee found that borrowers on Plan 2 loans, which covers everyone who started university in England or Wales between 2012 and 2023, were given the impression their loan was a simple, fixed deal, with repayments at one point likened by officials to a mobile phone contract. Then the terms were quietly rewritten. Repayment thresholds that were supposed to rise were frozen, again and again, and every freeze made borrowers pay more, sooner. The committee puts the cost of those freezes at more than £14,000 in extra lifetime repayments for an average earner. And unlike a mis-sold mortgage or credit card, there is no route to compensation, because student loans sit outside consumer protection law. Another three-year freeze is already pencilled in from 2027. The committee says reversing it is a “moral obligation.”

Second, the earnings. Analysis of government figures by The Telegraph found that a graduate leaving university in 2024 can expect to earn about £816,000 over their working life. In 2004, the equivalent figure was £892,000 in today’s money. That is £76,000 less, nearly eighty grand, for the same decision made twenty years apart. Meanwhile more than a million under-25s are not in education, employment or training, and one in seven of them holds a degree.

I have a personal stake in this one, so rather than talk in averages, let me open my own statements for you to draw your own conclusions.

In three numbers: borrowed £34,730. Repaid about £14,000. Still owe £41,550.

So how does the system actually work? Which plan you are on depends on when and where you studied, and the differences are bigger than most people realise.

You repay 9% of everything you earn above your threshold (6% for postgraduate loans). In monthly money:

Those who started university from 2023 pay more earlier because their threshold is lower. The newest system asks for more, sooner, and for longer: Plan 5 loans run for 40 years before they are written off, and this April was the first time any Plan 5 repayment was ever collected, so the newest graduates are only just finding out what that feels like.

Here is the strange maths of it all. Earn modestly and the write-off protects you: only around 27% of a recent Plan 2 cohort is expected to repay in full. Earn a fortune straight away and you clear the loan before much interest builds. But do what most careers actually do, start low and climb, and you pay the most of anyone: years of compounding interest first, then years of heavy repayments on a balance the interest has already inflated.

In my case, if my pay, the rates and the rules stayed exactly as they are today, I am on course to repay another £60,000 to £75,000 before the loan ends, on top of the £14,000 already paid. Call it around £80,000-£90,000 in total, for £34,730 borrowed. At least double, plausibly two and a half times. And the strangest part: at my current rate, the loan would clear just months before it would have been written off anyway, which is about as close to the maximum the system could collect as it gets. That is an illustration, not a forecast. It assumes nothing changes, and things always change. But it shows you the shape of the deal.

Now the honest other side, because there is one. Repayments stop automatically if your income falls. The loan never appears on your credit file. The write-off is real protection for lower earners. And on average, a degree does still lift lifetime earnings, even if the premium has shrunk. The story here is not that university is a con. It is that the terms changed under people’s feet after they had signed, which is precisely what the MPs concluded.

What you can do with this: check which plan you are on (it is on your payslip, or at gov.uk), actually read your annual statement rather than filing it in a drawer, and if you want to understand how the rules apply to your own numbers, MoneyHelper explains them for free. Not advice. Just your own numbers, worth knowing.

Sources: Treasury Select Committee report (7 July 2026); The Telegraph analysis of government figures; House of Commons Library; gov.uk 2026/27 rates and thresholds; my own Student Loans Company statements, 2016 to 2025.

Two true things about mortgages this week, and they point in opposite directions.

On one side, rates keep drifting down. Lenders trimmed fixed deals again this month, and brokers are describing the beginnings of a mortgage price war as they compete for the summer’s remortgage wave.

On the other, the Bank of England’s twice-yearly financial health check, published Tuesday, projects that just over five million households will see their mortgage payments rise by the end of 2028. That is about a million more than it expected in December, because the spring’s conflict pushed market rates back up. The sharpest edge lands this year: around 750,000 households still on fixes below 3%, deals from the ultra-cheap era, roll off in 2026 facing an average of £170 more a month. The average two-year fix now sits at 4.92%, up from 4.20% in December, and around 1.8 million fixed deals end this year.

How can both be true at once? Because falling rates and rising payments are measuring different things. Today’s “falling” rates are still far higher than the deals millions locked in years ago, so even a cheaper new deal usually means a more expensive monthly payment than the one it replaces. The cuts soften the landing. They do not remove it.

Before that reads as doom, the Bank’s own balance: the typical rise for someone coming off a fix in the next two years is about £45 a month, far gentler than the £120 jumps of 2022 to 2024, and household debt overall remains at what it calls normal levels. This is a squeeze, not a repeat of the crisis years.

What it means for you. If your fix ends this year or next, the gap between doing nothing and shopping around is usually the size of the jump. Most lenders let you lock in a new deal up to six months before your current one ends, and switch again if something better appears, so it may be worth understanding your options early. The base rate itself is unchanged at 3.75%, and the next decision lands on 30 July.

Sources: Bank of England Financial Stability Report (7 July 2026); HomeOwners Alliance; Moneyfacts.

A brief one this week, because sometimes no news is the news. The FTSE 100 is holding near the record ground it took earlier this month, and the pound is steady around $1.34 against the dollar. Markets have settled into waiting mode, with two dates circled: the confirmation of the next Prime Minister, expected around 20 July, and the Bank’s rate decision on 30 July.

For your pension, a flat week after a strong run simply means the gains have held so far. As we said last week, the market is not the economy, and a good month is just a month.

Sources: market levels at time of writing; refresh Monday morning before send.

A quick check across the board. Bitcoin sits around $64,000, the other majors are broadly steady alongside it, and the market overall remains down roughly 30% since January. Steady is welcome after a rough year. But steady and safe are not the same thing in crypto.

Crypto assets are high-risk and largely unregulated in the UK. Values are extremely volatile. You could lose all the money you invest. This is not investment advice. Never invest more than you can afford to lose.

Here is the number that framed this whole edition. New analysis by the investment platform AJ Bell, using official ONS spending data, worked out what a typical two-adult household needs to cover the bare essentials: food, household bills, transport, a mortgage, council tax, and a modest amount of entertainment. No childcare, no savings, no pension contributions, no holidays.

The answer, across Britain, is £2,964 a month, or £35,567 a year.

The biggest single line almost everywhere is the mortgage, which is exactly why the five million households expecting a rise in their mortgage bill by 2028 (covered in the rates section above) matters.

Two things jump out. First, these are essentials, before a single pound is saved or a child is looked after. Second, the totals sit uncomfortably close to what many full-time salaries bring home, which is why so many households now need two incomes just to stand still.

And two incomes bring their own bill: childcare. Coram’s annual survey puts real numbers on it. In England, the new funded hours have genuinely helped: a full-time nursery place for a child under two now costs an eligible working family about £149 a week, roughly £7,400 a year, because the 30 funded hours cover term time only and part of the day. Outside of term time, the bills jump. Families who do not qualify pay around £189 a week for just a part-time place. And in Scotland and Wales, where the under-threes entitlement does not exist, full-time care runs to about £259 and £325 a week, roughly £13,000 and £16,300 a year. Britain remains among the most expensive places in the world for childcare, swallowing more than a fifth of the average income according to the OECD.

That is the backdrop to a proposal in the news this week: the think tank Policy Exchange suggested scrapping the 30 free hours in favour of £7,000 vouchers for all parents, and raising child benefit to £4,000 for under-twos. Against the costs above, £7,000 roughly matches what an eligible English family already pays for full-time care with today’s funding, and covers less than half of a Welsh full-time bill. Supporters say vouchers are simpler and give parents choice; critics ask who pays for it and who loses out from ending the targeted hours. It is a proposal, not policy. But it tells you where the debate is heading: almost everyone now agrees the current system is creaking.

If the essentials are outrunning your income, free, non-judgemental help exists, and going early makes it easier: StepChange, National Debtline and Citizens Advice.

Sources: AJ Bell analysis of ONS spending data (July 2026); Coram Childcare Survey 2026; OECD; Policy Exchange proposal, reported by The Telegraph (July 2026).

If you have ever split a basket into three payments at a checkout, this one is for you. From this Wednesday, 15 July, buy now, pay later finally becomes regulated by the Financial Conduct Authority, the same watchdog that oversees your bank.

What changes:

You also gain two rights that matter. You can take complaints to the Financial Ombudsman. And qualifying purchases gain Section 75 protection, the same refund right you get when you pay by credit card.

Why now? Buy now, pay later grew from £60 million of lending in 2017 to over £13 billion in 2024, used by nearly 11 million of us. And the strain is showing. At the debt charity Money Wellness, a quarter of clients now hold buy now, pay later debt. The average owed per agreement has actually fallen, to about £251, but the number of agreements per person has doubled to nearly three. People are not splitting one big television. They are stacking small loans for everyday essentials.

The catch worth knowing: the new rules only cover agreements taken out from Wednesday onwards. Anything signed before 15 July stays outside the rules for its whole life, and store credit where the shop itself is the lender stays outside them too. The protections are real, but they start from now, not from the past.

Buy now, pay later is borrowing, plain and simple, and from Wednesday the rulebook finally says so. If juggling the repayments has crept up on you, StepChange and MoneyHelper are free and judgement-free.

Sources: Financial Conduct Authority (July 2026); Money Wellness (July 2026).

That’s your weekly brief, a little deeper this week, but we hope the additional reading adds value. If someone you know is staring at a student loan statement wondering how the balance went up again, forward them this one. It might be the most useful thing they read all month.

Coming up: a possible shake-up of council tax, with a new property tax that could replace it, timed for the moment the next Prime Minister is confirmed (expected around 20 July). The Bank’s rate decision lands on 30 July. And my own 2026 student loan statement arrives at the end of this month. I will show you exactly what it says.

Look after your money. It is on your side more than you think.

Follow us between briefs for mid-week updates and the data points worth knowing:

Thank you,

Ellis

themoneybrief.co.uk

The Money Brief. Not financial advice. The Money Brief provides news and commentary for informational purposes only. We are not FCA-regulated. Crypto and investments can go down as well as up. Always consult a qualified adviser before making financial decisions.

© The Money Brief 2026. All rights reserved.