Follow the Underlying Message from Brown's Budget Account Book; Get the Best out of Your Cash through This Post-Budget Checklist on; Major Aspects of Your Finances with JEREMY GATES

Article excerpt

ALL babies born since last September are resting in their cots this morning with an even broader smile than before - and pounds 250 locked safely away in their new Child Trust Fund, courtesy of Chancellor Gordon Brown, which could be worth pounds 1,410 when they reach 18.

Babes apart, however, there is a marked air of uncertainty - and nervousness - in the financial world after Gordon Brown's seventh Budget.

If the economy doesn't pick up strongly later in the year, as war memories fade fast, there are almost certainly more big tax bills on the way. Worrying indeed, when average household debt stands at pounds 39,000, including mortgage - against average income of pounds 24,000.

So far, as savers and investors are concerned, the importance of the Budget is not so much its direct initiatives - even the threatened attack on the 5 per cent of lump sum invested which pensioners take tax-free out of their with-profits bonds each year to boost income did not materialise.

Its real significance is the underlying message: we must learn to fix our finances - in a low inflation, low interest rate economy - with the same zealous attention to detail as the Iron Chancellor himself.

If a building society account pays a poor rate, it will probably get worse with time - because mug investors are too lazy to notice. Close it, and avoid incurring a penalty as you go.

If your credit card debts are costing a fortune, switch to another to enjoy the introductory offer of 0 per cent interest for a precious few months.

Here's a post-Budget action checklist - on the assumption that economic weather over the next 18 months could be decidedly stormy at times:

n Keep tax bills to a minimum

According to IFA Promotion, which promotes the benefits of independent financial advice, nine-out-of-ten UK adults waste an average pounds 114 per person this year alone, pounds 4bn in total, in unnecessary tax.

The latest one per cent rise in National Insurance Contributions, taking effect on Sunday (April 6), took a further pounds 8bn in one hit from taxpayers.

Says IFA chief executive David Elms: ''This tax hike should be a spur for those affected to look at how they could save tax, especially higher rate taxpayers, since most of the needless pounds 4bn tax wastage occurs among this group.''

IFA Promotion's dedicated website - www.taketaxaction.co.uk - is a first step to trimming tax bills.

n Time to move house?

Unchanged stamp duty scales batter homebuyers to the tune of pounds 2.8 billion a year- against pounds 675 million in 1996/7. Buyers at pounds 500,000 and above pay four per cent of price - at least pounds 20,000 - to the Government for the pleasure of moving.

However, David Moulton, residential researcher at agents Colliers CRE, says the continued exemption from stamp duty up to pounds 150,000 for buyers in 2,000 local authority wards nominated as 'deprived areas' throws up interesting prospects for buyers who take the long view.

He noticed the Chancellor made several references in his Budget speech to ''uplift'' for the regions - boosted by the Government's own determination to push thousands of civil service jobs out of the capital.

Leeds and Manchester property prices have fizzed already but many other provincial centres could power ahead if several thousand civil servants suddenly turn up. However, areas are nominated as deprived on six key measures - so there could be a headache or two before chosen localities are 'gentrified'.

In the mainstream housing market, Moulton predicts a seven per cent price rise this year on a sharply reduced total of sales. The market still hasn't recovered, he says, from Tony Blair's doom-laden New Year message from Number 10.

n Know your benefits

As the Chancellor steadily widens his range of benefits, even families who see themselves as better off might be surprised to find themselves in line for cash. …