Last year, over half the world’s population voted in an election and, in many cases, voted for change.

Commenting on the last 12 months, Hetal Mehta, Head of Economic Research, said: “In a year peppered with many notable elections, the global economy was marked by heightened economic uncertainty in 2024. Despite concerns at the start of the year that restrictive monetary policy would weigh on GDP, growth surprised to the upside and recessions in the key developed market economies were avoided. A gradual cooling of labour markets – lower vacancies and lower wage growth without a significant increase in unemployment – combined with progress in taming inflation, has allowed central banks to pivot policy towards gradual rate cuts.”

“But with the major elections behind us, it’s now time for governments to start implementing their policies.”

Key among these policies for investors will be the potential use of tariffs. Donald Trump spoke about their use a number of times during his election campaign and has continued to do so since. Other countries have threatened tariffs of their own in response. Tariffs tend to have an inflationary effect, as costs are passed across the supply chain, and this could have a knock-on effect for Central Banks debating whether to reduce interest rates, and at what pace.

Expectations around the pace of interest rate changes in the US were already slowing in 2024, as returning inflation to 2% proved more challenging than expected.

Speaking at the annual American Economic Association conference in San Francisco last week, Federal Reserve policymaker Adriana Kugler admitted: “We are fully aware that we are not there yet – no one is popping champagne anywhere.”

Despite the inflationary pressures, 2024 was a good year for large US shares generally. The S&P 500 recorded its second straight annual return of more than 20.0% (in US dollar terms). At the same time, the NASDAQ finished the year up over 20.0% for a sixth time in the last eight years.

Staying in North America, the political situation in Canada remains uncertain. Reports over the weekend suggested that current Prime Minister Justin Trudeau is set to announce his resignation in the coming days. Canadian elections are due in October, with Trudeau’s Liberal party currently notably behind in the polls.

Turning to Europe, the political situation remains very much in the air for a number of countries. This includes Germany, which also has an election later this year. The centre-right Christian Democratic Union (CDU) and its Bavarian sister party, the Christian Social Union (CSU) are currently leading the polls, with the far-right Alternative for Germany (AfD) behind them.

Questions also hang over the French political system. François Bayrou was named Prime Minister in December and faces a potentially hostile parliament that will make passing reforms challenging.

While the traditional heavy weights of the EU, France and Germany, have found themselves struggling of late, many of the countries that suffered in the Eurozone debt crisis in the aftermath of the 2008 Financial Crisis, such as Spain and Greece, have posted surprisingly positive economic news over the last 12 months.

Finally, turning to the UK, questions are being raised about potential ‘stagflation’ (higher inflation with stagnant economic growth) over 2025. This will be causing headaches for the Bank of England, who will need to finely balance competing pressures of reducing interest rates to spur economic growth while also keeping an eye on inflationary pressures.

When it comes to managing your money, making short-term or last-minute snap decisions can end up costing you more in late payments, lost interest or penalties. But getting your house in order and starting some regular savings and sound money management habits can make all the difference to your financial – and emotional – wellbeing.

These are our top five tax-smart tips for managing your money in 2025.

1. Make the most of your allowances

Do you know how many tax allowances you’re entitled to and whether you’re making full use of them? Many of us remember to top up our ISAs as much as possible before tax year-end, but there are other, often overlooked allowances and ‘carry forwards’ that can save you money.

Did you know, for example, that in addition to the £60,000 annual pension allowance (or 100% of your earnings, whichever is lower) on which you can qualify for tax-relief on pension payments, HMRC will let you carry forward any unused allowances from the previous three tax years?

2. Check what you’re worth

When was the last time you checked how your pensions were doing? Or how much interest your savings accounts or ISAs have earned ? Listing all your assets, from pensions to property and premium bonds, is a tax-smart start, but reviewing them regularly is an even smarter money habit for long-term financial wellbeing. You may have more than one pension pot if you’ve changed jobs in the past. And if you have an easy-to-access cash fund for emergencies, does it still have enough in it to keep you and your family afloat for up to six months, if necessary?

3. Spring clean your spending!

Do you know how many memberships and subscriptions you’re currently signed up for? Checking that you, or another family member, are actually still using the service you’re paying for, is another a smart money move. Those small monthly payments add up. You might want to switch to another provider or unsubscribe completely.

4. Set up regular contributions to ISAs, savings or pensions

Setting up regular, monthly payments into your savings or pension is a top tax-smart tip. It’ll put you ahead of the game at tax year-end and avoid a last-minute rush to bump up a tax-efficient ISA contribution just before 5 April. Plus, regular contributions to any form of investments help smooth out stock market volatility.

5. Check in regularly with a financial adviser

Setting aside an hour a week to check payments or interest rates yourself will save both time and tax in the long run. But checking in on a regular basis with a financial adviser to monitor if you’re on track to achieve your investment goals and objectives is just as important for your long-term financial health.

“This year we will show Britain can change…politics can be a force for good and we can unite the NHS behind a plan for reform.”

British Prime Minister Keir Starmer on his government’s plan for the NHS.