BUDGET 2026: What you need to know if you’re in your 20s/30s

Whether you’re hoping to buy your first home, build your savings, start a business or get your career on track, the Budget included several measures that could affect your finances.

There was new support for first-time buyers and young entrepreneurs, as well as changes to student loan interest and minimum wage rates. However, some of the help won’t arrive for years, and disappointingly, graduates will still face a freeze on the income threshold for student loan repayments.

Here’s what you need to know.

1. Buying your first home could become easier

The government has announced a new £4.7 billion Your First Home scheme, designed to help around 70,000 first-time buyers who might otherwise struggle to get onto the property ladder.

The scheme will allow eligible buyers to put down a deposit of just 2.5%, with the government providing an equity loan of up to 20% of the property’s value. The loan will be interest-free for the first five years, with charges gradually increasing after that.

Household income limits will be £110,000 outside London and £140,000 in London. Property price limits will vary by area, with maximum caps of £650,000 in inner London and £500,000 in outer London.

Pre-registration is expected to open by the end of December 2026, with applications from February 2027 and the first loans from April 2027.

There’s also a change for people saving towards a deposit. From April 2029, a new First Time Buyer ISA will replace the Lifetime ISA for new savers. It will offer a 25% government bonus on contributions of up to £4,000 a year, for a qualifying first home costing up to £450,000. Existing Lifetime ISA holders can continue using their accounts under the current rules.

In addition, and in very welcome news, the 25% withdrawal penalty is being reduced to 20% for existing Lifetime ISA holders buying a home costing more than the £450,000 threshold. That comes into effect from tomorrow (29 October 2026). This means you should be able to get back your own contributions and any interest or investment growth if you choose to buy a house that falls outside the price cap, although you will still lose the government bonus. What it does mean is that you won’t lose some of the money you contributed yourself – you’ll get every penny of that back.

The usual 25% charge will still apply to other unauthorised withdrawals.

What you can do: If buying your first home is a priority, check the scheme’s eligibility rules as more details emerge. You can also compare the different ways to save for a deposit before deciding which account is right for you.

2. Young entrepreneurs could get help starting a business

The government will pilot a new Young Entrepreneurs Allowance, offering successful applicants support towards their living costs during the first year of their business.

The aim is to help people with good business ideas who might otherwise struggle to get started because they don’t have financial support from family.

The Chancellor also announced a new programme to help female founders scale up their businesses, including support to tackle barriers to raising investment.

However, details of eligibility and how to apply for the allowance have yet to be confirmed.

What you can do: If you’re thinking about launching a business, keep an eye out for further details of the allowance and the support available to female founders.

3. Student loan interest is being capped, but repayment thresholds remain frozen

There is some help for graduates with Plan 2 and Plan 3 student loans. From 1 September 2026 to 31 August 2027, interest rates on these loans will be capped at 6%.

However, the income threshold at which Plan 2 borrowers start repaying their loans remains frozen at £29,385 until April 2030. This means that, if your salary rises while the threshold stays the same, you could end up making repayments when you might not have done if the threshold had increased with inflation.

What you can do: Check which student loan plan you have and how much you earn above the repayment threshold. Remember that repayments depend on your income, not simply the size of your outstanding loan.

4. Minimum wage rates are increasing

From April 2027, the National Living Wage for workers aged 21 and over will rise by 3.9% to £13.21 an hour.

The minimum wage for 18- to 20-year-olds will also rise by 3.9%, to £11.27 an hour. For workers aged 16 and 17, and eligible apprentices, the rate will increase to £8.31 an hour.

Although younger workers will receive a pay rise, the gap between the rates for younger and older workers remains.

What you can do: If you’re paid the minimum wage, check your hourly rate after the changes take effect in April 2027. If you’re starting a new job or apprenticeship, make sure you’re being paid the correct rate for your age and circumstances.

5. A new incentive to start investing is being explored

The government will work with the investment industry to explore a new ISA incentive for people investing in a Stocks and Shares ISA for the first time.

The aim is to make investing more accessible, but the details haven’t been finalised, so it’s too early to say exactly what the incentive will involve or when it might be introduced.

What you can do: If you’re considering investing for a long-term goal, learn about the risks and potential benefits before committing your money. You don’t need to wait for a new incentive to start understanding your options.

But not all the support is available immediately, and some schemes still need more detail before you can work out whether you’ll qualify.

Focus on the changes that are relevant to your own circumstances, and don’t make major financial decisions based on announcements alone. Check the eligibility rules and timings before relying on any new support.