HENRY households to see over 15k hit in annual purchasing power by 2029 due to Budget measures 

• IG carried out analysis of Budget impact for high and mid-high earners using latest HM Treasury data 

• Research shows top earners (average income of £103,700) can expect reduction in annual purchasing power of £15,658 by 2029

• Mid-high earners (average income of £65,700) can expect reduction of £8,953

HENRY households (“High Earners, Not Rich Yet”) are set to see an average real reduction in annual purchasing power of over £15,000 by 2029 as a result of the Chancellor’s Budget, according to new analysis from investment and trading platform IG.

IG analyzed HM Treasury data assessing how tax freezes, welfare policies and public spending decisions will affect UK adults across all ten household-income deciles up to 2028/29, the final year of the current Spending Review period.

The analysis shows that adults in the ninth decile (average income £65,700) receive zero net support from the Budget, while those in the top decile (average income £103,700) face an average net annual income impact of –0.3%.

By contrast, the bottom decile (average income £13,100) receives an annual income boost of more than 7%, and those in the fifth decile (average £31,400) see an increase of over 2%.

When factoring in household inflation and fiscal drag resulting from frozen tax thresholds over the next three years, ninth-decile earners face an average reduction in real purchasing power of £8,935 by 2029. For top-decile earners, the reduction is £15,658.

Chris Beauchamp, Chief Market Analyst at IG said: “While the Chancellor met her fiscal rules and avoided increases to income tax or national insurance, the combination of policy measures and frozen thresholds will have a disproportionately large effect on HENRY households.

“As the name suggests, many in these income bands carry high living costs and wouldn’t recognize themselves as ‘rich’. Once inflation and fiscal drag are factored in, the squeeze on real disposable income will feel significant, forcing some households to reassess spending, saving and long-term financial plans.

“In this environment, households in this bracket should be motivated to become more engaged with investing as they recognize that growing and protecting whatever wealth they can is increasingly crucial. However, there is also the risk that squeezed disposable incomes limit how much households can invest – something the government should consider as part of its drive to get more Brits investing.”

About the data

Household inflation data for 9th and 10th income deciles taken from:  Household Costs Indices for UK household groups: July to September 2025. Household inflation for higher earners is projected to follow Bank of England Monetary Policy Report CPI data over the next three years (at a relative rate -4ppts below CPI to reflect the current ratio), with a -8.6% compounded impact on purchasing power. RHDI figures in line with OBR Economic and fiscal outlook November 2025. Estimates for impact of fiscal drag for deciles 9 and 10 informed by pre-Budget analysis from Institute for Fiscal Studies and the Resolution Foundation.

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