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Metro
28-05-2025
- Business
- Metro
This is how much your salary should increase each year you work at a company
Money is an awkward topic, especially in the workplace. But while we're conditioned not to talk about it for fear of being rude, we're simultaneously encouraged to know our worth and confidently request pay rises. Unfortunately, many UK workers don't have a universal understanding of what a fair salary is, and are often oblivious to their potential earning range. This means that when demanding said wage increases, employees may not even know how much to ask for. Plus, with 53% of Brits unaware of what their colleagues make (especially those in higher positions), how is anyone meant to know what they should be earning, anyway? To set the record straight, Metro spoke to finance specialist Pernia Rogers, founder of Your Finance Travel Buddy, and Nisha Prakash, finance expert and lecturer in Finance Management at the University of East London. Word of warning: Pernia says that even if you've been at a company for years, loyalty doesn't always lead to bigger pay rises. Nisha also highlights that salary hikes and promotions depend on the industry. For instance, tech and finance sector jobs offer faster salary growth than public sector roles, which she estimates at around 2% to 4% per year. To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video 'Some companies offer inflation-adjusted hikes so that employees' standard of living is not impacted by rising costs,' she adds. 'In the UK, salary increases by tenure are not regulated by law but are influenced by industry standards, company policy, and individual performance,' explains Nisha. Having said that, there are broad industry averages which could help set realistic expectations. According to employment website Indeed, the average annual pay rise for an experienced employee is typically between 3% to 5%. 'Anything above 10% is generally considered a good hike, which is typically linked to promotions or job changes,' Nisha adds. In terms of your first year in employment, Pernia urges not to expect too much of a bump, as you're likely finding your feet within the company and getting to grips with your role. 'Raises tend to be small and usually reflect inflation or company performance,' she says, recalling that her first pay rise in a graduate scheme was 1.75%. The following year, Nisha says the hike will 'follow a bell curve based on the years of experience.' If you're expected to take on more responsibility, you should earn more, but this doesn't always happen, in which case Pernia recommends negotiation – 'especially if new hires are earning more.' As for the exact numbers, Nisha reveals that freshers are typically given 3% to 10% increases, while employees with two to five years of experience can expect 5% to 20%, depending on the job market and individual performance. At around three years, Pernia warns you risk being underpaid. 'Companies often give smaller annual increases than what you'd get by changing jobs,' she explains. 'Many people who switch jobs after two or three years see 15% to 25% increases compared to 2% to 5% raises internally. When I moved jobs at 3.5 years, I got a 64% pay rise.' To gauge if you've been bitten by the so-called 'loyalty penalty', Pernia says: 'With promotions or increased scope, your salary should be 15% to 30% higher than when you started.' If it's not, you might be falling behind the market rate. Next, benchmark your role externally and negotiate, or prepare to move. After five years, staying put only makes sense if you're rewarded. Although Nisha suggests that the increase rate lowers after five years of service – unless you're promoted or your role changes within the company – according to Pernia, you should be at least 30% up from what you started on, especially if you've climbed the ladder. 'If your salary hasn't kept pace with promotions, inflation, or market value, you may be losing out financially,' she says. However, as we know, it's not a one-size-fits-all box, and what's realistic varies depending on your career. While her most significant pay rise came when she gained her Chartered Accountant qualification, Pernia stresses that not every career path has jumps like that, so it's important measure against your field and market. Still, don't be afraid to negotiate for what you deserve or explore alternative roles if you don't feel valued. And remember, 'you're not obliged to accept any offer if it doesn't meet your expectations.' As above, there's not one clear answer. Promotion timeline depends on the industry, employer and worker's performance. But for scope, Nisha says a realistic expectation is to move from entry-level to mid-level within one to three years, adding: 'This is the fastest promotion phase, and it is typically tied to meeting timelines and learning core skills.' For mid-level to senior jumps, the timeline takes around two to five years., and 'the expectations here are performance, leadership traits and subject expertise.' Next up, the transition to management from a senior level takes three to seven years, with key criteria being networking, visibility and capability to create an impact. To get into a senior management roles (such as director) you're looking at five to over 10 years, progressing based on factors like creating long-term impact and business results. Again, this metric could vary across industries. 'For instance, promotions are much faster in startups compared to corporates,' Nisha says, adding that the 'general rule of thumb in corporate is that if you haven't been promoted within the first three years of starting work, despite strong performance, it is time to ask, negotiate or move on.' Just raising the question means management will be forced to provide you with a clear career path or development plan, so it's worth a go. Nisha says that achieving a promotion requires more than hard work. More Trending She explains: 'One has to consistently work smart, be visible and align with business needs. 'Hence, it is important to request a roadmap from your manager, including what skills, attitude, behaviour, and achievements are required for the next level.' To improve your chances she recommends 'making your manager's work easier' – but don't be afraid to blow your own trumpted or 'assume your work speaks for itself'. View More » Nisha's final words of wisdom? 'Don't wait forever — if you have been performing at the next level, have the conversation.' Do you have a story to share? Get in touch by emailing MetroLifestyleTeam@ MORE: Map shows how much you need to earn to buy a home where you live in the UK MORE: Wear a uniform to work? You could be owed hundreds of pounds from the government MORE: Ignore the CEO influencers — not everybody's cut out to run a business
Metro
24-05-2025
- Business
- Metro
This is how much your overdraft limit should be, according to your age
I'll never forget being a naive, 18-year-old fresher, checking my bank account at the end of the month to see if I had enough money to go to the pub after uni. Usually, after rent, splitting bills with housemates, and paying my gym membership from my part-time job, I'd be left with enough for a couple of pints. Until one day, £2000 magically dropped into my Santander student account. Confused at first as to where it came from, these concerns soon transitioned into 'I'm rich,' when I realised my bank had 'gifted' me a lovely overdraft to spend at my leisure. This, of course, was followed by a shopping spree at Beyond Retro, lunch in the Brighton Laines, and an afternoon sesh at East Street Tap. Looking back, I can see how silly my spending habits were and how dangerous they could become. But with 2K casually landing in a few of my friends' accounts – during the height of summer – it was safety in numbers. Thankfully, I managed to pay my overdraft off before the charges kicked in, which saved me a whole lot of future debt. It also forced me to become more responsible with money, focusing on saving it, rather than spending. But the whole scenario got me thinking: what should your overdraft limit be, according to your age? Because at 18, a random and unasked-for £2000 doesn't seem like the brightest idea. Hopefully, almost a decade later, it's a thing of the past. With this in mind, Metro spoke to Matthew Sheeran, money saving expert at Money Wellness, and finance specialist Pernia Rogers, founder of Your Finance Travel Buddy, to get the low-down. To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video 'There's no one-size-fits-all answer to how much your overdraft limit should be, but we do see some patterns based on age and life stage,' explains Sheeran. Rogers agrees, adding: 'A more practical approach is to set your overdraft limit according to your income, which usually grows as you get older.' But for clarity, the pair have split these guidelines into age groups: 'If you're 18 to 24, your overdraft limit will typically be somewhere between £100 and £500,' says Sheeran. At this stage, most people are studying or just starting out in work, so they don't need or qualify for a large buffer. If you're unsure of what bank account to go for as a student or young adult, Rogers says that many student accounts offer interest-free overdrafts of around £500. 'These can be useful if managed carefully, but it's important to treat it as a buffer, not free money,' she warns. If only I'd had such advice back in the day. According to Sheeran, this is when we expect to see limits rise to around £500 to £1,000. 'As people's income increases, they start taking on more financial responsibilities like rent or bills,' he states. Rogers elaborates: 'Early in your career, between the ages of 25 and 30, when your income is more stable, banks may offer larger overdrafts.' However, the expert still urges you to be sensible. Rogers says it's a smart idea to limit your overdraft to about one month's salary and only use it in emergencies. By the time people are in their late thirties or early forties, their overdraft might be as high as £1,500, Sheeran reveals. But ideally, it's used only for unexpected costs, not everyday spending. The amount is likely increased to this level due to higher earnings and the expectation that people this age are more financially mature. Meaning, they typically refrain from splurging on superficial purchases. More Trending Once you're older – around the 30+ age – and more established, you'll have access to higher limits, explains Rogers. However, your overdraft should never be part of your regular income. 'Once people reach their mid-forties and beyond, it's common to see limits start to shrink again,' Sheeran says. He puts this figure at around £500 to £1,000, as people become both more financially stable and look to reduce their reliance on credit. Overall, he says it's important to remember that your overdraft is still a form of borrowing, and if you're constantly in it, that could be a warning sign that something's not quite right with your budget. View More » 'It's designed to be a short-term safety net, not a regular source of money.' MORE: The 'unusual' way you can build your credit score as a renter — and make your money work harder MORE: My credit score was so bad I couldn't get a phone — now I'm a homeowner MORE: Map reveals the UK loan hotspots where people borrow the most money
Daily Mirror
05-05-2025
- Business
- Daily Mirror
Sainsbury's Bank customers urged to check Nectar points after NatWest merger
All bank customers have been encouraged to check over their finances Sainsbury's Bank customers have been encouraged to keep an eye out for changes to their Nectar points. In a key change that began on May 1, customers with the bank are being moved over to NatWest. Sainsbury's Bank is transferring all its personal loans, credit cards, and savings accounts over to NatWest. Bank leaders have stated they hope to finish the move over to NatWest systems by the end of 2025. Customers are informed there will be no immediate changes including to Nectar points, which will operate the same. However, industry experts have said there may be alterations to the system further down the line. Personal finance expert Aaron Peake, from the free credit scoring service CredAbility, said that bank bosses may make changes to Nectar points. He explained: "Loyalty schemes are often one of the first things to change after a buyout. "So if you're collecting points, you might want to make the most of them now or look for an alternative card if rewards disappear." He also said there is something customers should do as a first priority. He urged: "The first thing to do is check any recent emails or letters to make sure you're aware of what's happening. If you've got a savings account, personal loan or credit card with Sainsbury's Bank, look at your interest rate, fees and repayment terms to see if anything is set to change. "It's also worth checking your direct debits or standing orders, just in case account details are updated." An update from Sainsbury's Bank reassured customers: "Your Sainsbury's Bank Credit Card remains valid and you can continue to use it instore, in other stores or online. "As we usually would, we will contact you as and when any changes are made to your product." Pernia Rogers, founder of Your Finance Travel Buddy, spoke about what the acquisition means for the wider UK banking scene. She said: "By acquiring Sainsbury's Bank, NatWest is bringing in 1.8 million customers, along with £1.4 billion in personal loans and £1.1 billion in credit card balances. It's another sign of the UK's high street banking market becoming increasingly concentrated, as larger banks continue to absorb smaller players. "That could mean less competition in some areas, which may affect things like choice, pricing and innovation for customers down the line."
