MILLIONS of households will be impacted by 10 major changes to their finances in 2023 – but you may be able to avoid some.

Households will be hit by tax rises but those on benefits including Universal Credit will get a payment uplift from spring.

Energy bills will rise by £500 for the average household and mobile, broadband and TV packages will see prices rise from April.

Here are all the changes set to impact your finances next year and a detailed explanation of what you can do to minimise the damage.

1. Stamp changes

Royal Mail has started to phase in newer barcoded stamps, which will replace old-style stamps from January 31, 2023.

This means anyone with a stash of 1st or 2nd class stamps has just weeks left to use them before they become invalid.

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From January 31, only the new style stamps complete with barcodes will be valid, and you'll face a surcharge if you try to use anything otherwise.

The move will make letter sending more secure, but it doesn't make post any easier or cheaper for customers to track.

What can I do about it?

Stamps can be traded in before the cut-off deadline – and Royal Mail will let you do it for free.

Customers will have to fill out a "Swap-Out" form on the Royal Mail website or call the postal giant directly to request a form.

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Alternatively, you can get one in person from a local delivery office – but not a Post Office.

You can find your local delivery office by using the online locator tool on the Royal Mail website.

You'll then have to post back the stamps you want to swap to a Freepost address.

And if you have more than £200 worth of stamps, Royal Mail recommends these are sent by recorded delivery.

2. Interest rate rises

The Bank of England's Monetary Policy Committee (MPC) will meet twice every quarter to decide if interest rates need to rise.

The MPC will make any announcements on the Bank of England's base rate on:

• Thursday, February 2
• Thursday, March 23
• Thursday, May 11
• Thursday, June 22
• Thursday, August 3
• Thursday, September 21
• Thursday, November 2
• Thursday, December 14

If the bank decides to raise interest rates further it will make the cost of borrowing, including loans, credit cards and mortgage repayments more expensive.

And four million mortgage holders are already set to see their monthly payments jump by the end of the next year when they move off cheap mortgage deals and are forced to refinance onto a higher rate.

However, savings rates will get a boost as banks continue to battle it out by offering market-leading interest rates.

Historically banks don't rush to up their savings rates in line with the base rate of interest – however, more and more are battling it out on the high street to offer the best rates.

What can I do about it?

If you are due to come off a cheap fixed mortgage deal in the coming months, it's worth preparing to remortgage early.

Lenders typically move households onto a more pricey SVR once your mortgage deal comes to an end.

That means you could have been on one of the best mortgage deals and suddenly your monthly repayments will increase.

But households can start looking for a new mortgage up to six months before their deal ends.

Lots of lenders now let customers lock in a new rate six months in advance.

Others will let you lock in a new rate at least three months ahead.

We've explained how you can find the best mortgage deals.

Savers wishing to boost their nest egg should search around to see if they can get better returns with another bank or building society.

We've previously explained how to find the best savings rates.

3. Rail fares up

Rail fares rise usually each January based on the annual increase in the retail price index (RPI) measured the previous July.

But during the Covid-19 pandemic, these price hikes didn't actually come into force until March.

The government has confirmed that rail fares won't rise by July's RPI value of 12.3% next year.

But there has been no announcement about when the March increases will be announced, but rail officials do not expect any announcement until the new year.

What can I do about it?

Regular passengers may be able to cut the cost of standard anytime, off-peak, advance and first-class advance tickets by up to a third with a railcard.

You can buy these through National Rail but you'll need to pay a fee.

That said, if you regularly travel by train, you'll make up this cost in no time.

Cards for those aged 16-25 cost £30 a year, or £70 for a three-year card.

Don’t pay over the odds for tickets and remember to compare prices before you buy.

Ticket firms usually start selling fares around 12 weeks in advance.

This is when Network Rail releases its timetable.

The earlier you book, the less you'll pay for your seat so get organised if you know you're going to be travelling over the next few months.

First, check the National Rail website, which is a great way to get an overview of routes and travel times.

Then check the train operating companies' website or Trainline to see if cheaper fares are available.

But sites like Trainline will usually charge you to make a booking — between 25p and £1.50 — so factor that into your savings.

4. Mobile, broadband and TV price hikes

Many telecom companies raise their prices every April in line with the Consumer Price Index (CPI) of inflation plus an additional 3.7% or 3.9%.

Rules allow these providers to hike their prices midway through customers' contracts.

The CPI measures the monthly change in prices paid by consumers on an average basket of goods and services.

And next year some broadband customers could face bill hikes which see an extra £87 to £113 added to annual bills when compared against the amount they initially signed up for, according to Which?.

Millions of BT customers would face the largest potential increase with an extra £113.07 added to their annual bill, according to the consumer site.

But the exact amount that your bills will rise from spring will depend on the type of package you've taken out and how much it costs right now.

What can I do about it?

Switching contracts when yours is up is the single best way to save money on your telecom bills.

In the weeks before your contract is up, use comparison sites to familiarise yourself with what deals are available.

It's a known fact that new customers always get the best deals.

Sites like MoneySuperMarket and Uswitch all help you customise your search based on price, speed and provider.

This should make it easier to decide whether to renew your contract or move to another provider.

However, if you do not want to switch and are happy with the service you're getting under your current provider – haggle for a better deal.

You can still make significant savings by renewing your contract rather than rolling on to the tariff you're given after your deal.

You could save up to £210 a year on your bills by haggling alone.

If you need to speak to a company on the phone, be sure to catch them at the right time.

Make some time to negotiate with your provider in the morning.

This way, you have a better chance of being the first customer through on the phone, and the rep won't have worked tirelessly through previous calls which may have affected their stress levels.

It pays to be polite when getting through to someone on the phone, as representatives are less inclined to help rude or aggressive customers.

Knowing what other offers are on the market can help you to make a case for yourself to your provider.

If your provider won't haggle, you can always threaten to leave.

Companies don't want to lose customers and may come up with a last-minute offer to keep you.

Last but not least, it's worth investigating social tariffs.

These broadband packages and discounts have been created for people who are receiving certain benefits.

They're often available to those on income support, Universal Credit, or disability allowance.

Around 4.2million households are eligible for these cheaper tariffs but only 55,000 are making use of them.

Prices start from £12.50 a month, so ask your provider what's on offer.

5. Prescription charges

Prescription charges usually rise every April in England and the exact amount they rise by is set by the Department for Health and Social Care.

But in April 2022, prescription costs were frozen for a full 12 months until April 2023.

At present, Brits have to pay £9.35 for a single prescription for their medication.

The government hasn't yet confirmed if prescription charges will rise in England in 2023.

Prescriptions remain free of charge in Northern Ireland, Scotland and Wales.

What can I do about it?

A prescription prepayment certificate (PPC) could save you money if you have 12 or more prescriptions dispensed each year.

The certificate covers all your NHS prescriptions for a set price.

Three-month PPCs cost £30.25.

Twelve-month PPCs cost £108.10 and can be paid for in instalments.

You can buy a PPC on the NHS Business Services Authority website.

Millions of Brits are eligible for free prescriptions, including those over 60, those under 16, and those 16 to 18 in full-time education.

You can also get your prescriptions for free if you're pregnant or have a medication exemption certificate.

You're also entitled to free prescriptions if you or your partner (including civil partner) receive, or you're under the age of 20 and the dependant of someone receiving:

• Income support
• Income-based jobseeker's allowance
• Income-related employment and support allowance
• Pension credit guarantee credit
• Universal Credit

6. Energy bills will rise

Energy bills for the typical household were initially set to be frozen at £2,500 for the typical household for two years.

But the Chancellor announced in November that it would only be in place for six months.

In the Autumn Statement, Jeremy Hunt said typical bills will rise to £3,000 in April.

This means the average household will see their bills rise by £500 a year.

And while there's nothing you can do to stop these costs from rising, there is a whole host of government support in the pipeline to help hard-up households.

What can I do about it?

Millions of households started receiving a £400 energy bill discount from October 1.

The payment is dished out by your energy supplier and split across six discounts between October and March next year.

We've listed how the leading energy suppliers are paying households.

But the way you'll be paid will depend on how you pay for your energy.

Check with your supplier to confirm how you'll receive the cash.

A £900 payment will be going to millions on means-tested benefits and Universal Credit in 2023.

To be eligible for the payment, households will need to be claiming at least one of the following:

• Income-based Jobseeker’s Allowance
• Income-related Employment and Support Allowance
• Income Support
• Pension Credit
• Tax Credits (Child Tax Credit and Working Tax Credit)
• Housing Benefit
• Council Tax Support
• Social Fund (Sure Start Maternity Grant, Funeral Payment, Cold Weather Payment)
• Universal Credit

Jeremy Hunt confirmed in his Autumn Statement that millions of elderly Brits will receive another one-off £300 'Pensioner Cost of Living Payment' in April.

Anyone claiming the following will also qualify for a further £150 cost of living payment next year:

• Attendance Allowance
• Constant Attendance Allowance
• Disability Living Allowance for adults
• Disability Living Allowance for children
• Personal Independence Payment
• Adult Disability Payment (in Scotland)
• Child Disability Payment (in Scotland)
• Armed Forces Independence Payment
• War Pension Mobility Supplement

There are also plenty of energy grants and schemes open to help you out if you're struggling.

Ask your supplier what's on offer and how to apply.

7. Council tax rises

The government has confirmed that it will allow local authorities to increase council tax above the cap of 2.99% without a referendum.

Every year, councils decide how much to increase council tax bills by.

Of course, the amount your bill will rise by is still being decided.

Confirmation of rises is usually shared at the beginning of the new financial year in April.

The average cost for Band A properties in England is £1,310.

A five per cent rise would see it hit £1,375.

Band B pays an average of £1,529 — this would go up to £1,605 with the same rise.

The average council tax for Band C property is £1,747.

A five per cent rise would take bills to £1,834.

The average tax for a Band D home is £1,966.

This would reach £2,064 with this increment.

What can I do about it?

People on low incomes or benefits such as Universal Credit may be able to get a discount on their council tax.

This can vary between councils, but you could be exempt from paying any council tax at all.

The schemes are means-tested, and will usually depend on your income and any children or adults living with you.

Single adults living in a property can get a 25 per cent discount on their bill.

This is for people of all incomes and applies if they are the only adult living in the property.

The discount also applies if they live with a young person aged under 18, or someone aged 18 or 19 in full-time education.

A reduction could also be applied if there is a disabled person living in the property.

This is known as a disabled person’s reduction and each council has its own criteria.

You may also get 50 per cent off your council tax if you live with someone who is severely mentally impaired.

8. Universal Credit and benefit payments to rise

Millions of households will get a benefit payment boost this year as monthly payments are set to rise.

Benefits and Universal Credit payments will rise in line with September's inflation rate of 10.1% in April.

Last April, benefits rose by 3.1% but prices have soared even more since then.

But this year, claimants are in for a bumper boost to help keep up with spiralling prices.

For example, the Universal Credit standard allowance for those who are single and aged under 25, will rise from £265.31 to £292.11.

For those single and aged 25 or over, the standard allowance will rise from £334.91 to £368.74

We've listed exactly how much extra you'll get depending on what benefits you claim.

What can I do about it?

Millions are eligible for Universal Credit but aren't claiming what they are entitled to – so make sure to claim now.

The amount you will get depends on several criteria, including your age, earnings, whether you live with a partner, have children or are disabled.

Right now, the standard monthly allowance for single people aged under 25 is £265.32, rising to £334.91 for older claimants.

Brits that are in a couple, where both members are under 25, will get £416.45 for both people.

If either half of the couple is over 25, you'll get £525.72.

Do bear in mind that the current standard allowance will rise in April.

You will get extra money if you've got children or have a health or disability condition.

You can also claim more cash if you need help with your housing costs.

You may be able to get Universal Credit if:

• you’re on a low income or out of work
• you’re 18 or over – but there are some exceptions if you’re 16 to 17
• you’re under State Pension age (or your partner is)
• you and your partner have £16,000 or less in savings between you
• you live in the UK

If you're not eligible for Universal Credit, you can use the government's benefits calculator to find out what help you can get

9. State pension rise

Jeremy Hunt confirmed in his Autumn Statement that the triple lock would stay – and pensions would rise in line with inflation.

The move means millions of pensioners will get an £870 rise in their state pension payments.

This means the full state pension rate of £185.15 per week will increase by £18.70.

It means pensioners would get a total of £10,600 a year.

While the basic state pension will go up £14.35 from £141.85 per week to £156.20.

Over the year, that would be an increase of £746.20 to £8,122.40 in total.

But many are missing out on extra cash offered via pension credit.

What can I do about it?

According to the DWP, over 850,000 pensioners are missing out on £1.7billion worth of pension credit payments.

These payments can add an extra £3,300 to an average pensioner's annual income.

You can start your application up to four months before you reach state pension age.

Applications for pension credit can be made on the government website or by ringing the pension credit claim line on 0800 99 1234.

Pension credit tops up your weekly income to £182.60 if you’re single or £278.70 if you have a partner.

You may get extra amounts if you have other responsibilities and costs.

10. Income tax and National Insurance thresholds frozen

Jeremy Hunt has extended a freeze on income tax and National Insurance thresholds until 2028.

The freeze was meant to come to an end in 2026, but extending this will drag millions more into paying a higher tax rate.

That is because inflation and rising wages will mean more workers will go over the thresholds for paying higher tax.

Thresholds would usually be tweaked to take both of those things into account.

But the move means that someone with an average UK salary of £33,000 will be left to pay almost £2,557 more income tax between now and 2028.

The basic rate of income tax currently kicks in on earnings over £12,571, and the higher rate of 40% at £50,271.

National Insurance is a tax on your earnings and is deducted from your wages each month.

You pay National Insurance if you’re 16 or over and either:

• an employee earning above £242 a week
• self-employed and making a profit of £6,725 or more a year

What can I do about it?

There isn't anything you can do to avoid stealth tax rises like this.

But it's always worth checking to see if you're on the right tax code – many aren't and end up paying more than they owe.

Your tax code will be displayed on your payslip, usually listed near your National Insurance number.

You can also use the government's online tax checker tool to view your tax code.

You can check if your tax code is correct by using HMRC’s online tool or MoneySavingExpert’s free online tax calculator.

If it's wrong, you should contact HMRC to let it know on 0300 200 3300.

HMRC will write to you or email you if they change your tax code – and they will also write to your employer about any changes too.

Then, your updated tax code should show on your next pay slip.

If you are due a tax rebate, HMRC will let you know by sending you a letter called a P800 or a simple assessment letter.

However, P800 letters can also tell you that you haven't paid enough tax, and you'll have to repay it.

You will only get a P800 after the tax year has ended, which will arrive between April and November.

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This letter will tell you if you can claim online through the government's website. 

If you claim online the money will be sent to your account in about five days.

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