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Election 2015: cross your fingers we don’t have to do this all again
With no obvious front-runner, the outcome of the election is far from clear. But no matter who wins – or doesn’t win – it will have a huge impact on your finances, says John Stepek.
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Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.
Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.
Polls are often wrong, of course. But if reality in any way reflects today's figures, with Labour and the Conservatives neck and neck, then we could be doing it all again in a few months.
Whatever happens, it's going to matter to your finances. So despite the ennui, it's worth paying attention
I don't care who you vote for or if you even vote
I think it's important to exercise your right to stick a ballot in the box, even if it's a spoiled one. And I think it shows respect to the forebears who fought and won that vote, for themselves and for you.
But I think a lot of things, and you don't have to agree with a single one of them.
What I will say is that the outcome today is going to have a big impact on your investments and the way you plan your finances, regardless of who wins or who doesn't.
A Conservative-led government promises more of the same: there's an expressed desire to cut government spending, even although that may not in fact materialise; there's a general sense that taxes shouldn't be higher than they are in an ideal world; and you'd expect the pensions reforms introduced so far to remain in place, so that might make planning for retirement a bit easier (until the next election, at least).
A Labour-led government promises higher taxes on high earners. There have been promises of intervention in various markets rental property, energy and public transport, for example. There's a sense that there's no real problem with government spending, beyond the fact that the deficit seems to be something that bothers a significant proportion of the electorate.
The difference in attitude to public spending suggests that gilt markets and sterling will be wobblier in the event of a Labour victory. That shouldn't be underestimated, given that there are far deeper faultlines in global bond markets that may explode to the surface in the next five years.
Neither party will fix' the housing market. Prices are perhaps a little more likely to fall under Labour, but that's mainly in the markets that wealthy overseas buyers have been active in. So that'll remain a key driver of inequality and a massive drag on our national productivity regardless of who gets in.
A shame, that. But politicians will only discover the courage to tackle the housing market when the number of voters penalised by it outweighs those who believe they benefit.
Both parties plan to cut pension tax relief for higher earners, so if you're in a position to worry about that, get your skates on.
Both parties face constitutional madness. Given support for the SNP, Britain could quite easily break up in the next five years (even if only by the backdoor), and it's hard to see how that issue is settled otherwise.
EU membership will be a big issue under a Conservative-led government. But it might become one anyway if you're not holding the line against further integration, then Europe has an interesting habit of sneaking up on you.
And regardless of what they say, both parties will probably need to raise taxes by more than they admit. And it'll come early in the parliament, because that's when the pain has the lowest political cost.
And what if no one gets in?
That could leave us with all manner of upheaval and market volatility as various outcomes become more or less likely.
At MoneyWeek, we think a Conservative government or a repeat of the current coalition victory will be the most investor-friendly outcome. There's an element of stability there, which is helpful; and, while they can't seem to stop tinkering with things, there's an underlying respect for individual choice and responsibility that keeps them from doing anything too nutty.
But we might not get that outcome. And that's why we're trying to make sure that our readers are best placed to deal with whatever happens as soon as the results are through. If you haven't already signed up for our post-election coverage, do it now you've only got until the polls close tonight!
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