As the conflict in the Middle East continues, there is growing uncertainty about how this is going to affect households and their money.
Rising gas and oil prices have had knock-on effects, not only on the cost of fuel and energy but also mortgages and pensions.
The i Paper spoke to experts about the financial impact it could have on people and what they can do about it.
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What it means for pension pots
The conflict is having an impact, especially on those who are invested in global markets, including workers who have a defined contribution (DC) pension.
If you have a DC pension through your workplace or privately, you will be invested in a portfolio made up of stocks, funds and bonds, designed to deliver returns over the long term.
However, global stock markets have been volatile in response to the US and Israel launching attacks on Iran meaning many Brits will have seen their pension performance dip slightly in the last week or so.
Tom Selby, director of public policy at AJ Bell, said a short-term hit to people’s investment value shouldn’t be a cause for alarm.
He said: “When markets go through tough patches such as now – and as we have seen plenty of over the last decade – it’s important not to get swept up in a wave of panic.
“While we don’t know if the Iran war is going to be a short-lived event or prolonged, it is always prudent to give your portfolio a health check to ensure that you’re happy with the shape of it and the risks you are taking.
“Spreading these risks across sectors, geographies, and asset classes (such as bonds and gold) could help to limit any blows.”
Experts urged those approaching retirement to check if their investment strategy is suitable for their preferred way of taking retirement income and build flexibility into their plan should things get worse over the coming weeks and months.
Craig Rickman, personal finance expert at interactive investor, said: “Sharp market drops at the point you plan to draw from your pot could jam a spanner into the gears of your well-laid retirement plans, especially if you’re set on buying an annuity.
“Your savings may not have time to recover any losses, reducing how much guaranteed income you can secure.”
For those who no longer intend to buy an annuity – a guaranteed income for life – AJ Bell warns you could be sitting on a substantial fall in the value of your investments.
“For anyone in this position, you have the option to sit tight and hope the value of your investments recovers or shift your portfolio so your investments match your retirement intentions and accept that you might need to wait a bit longer to access your pension or take a slightly lower income,” Selby explained.
If you are already taking an income from your pension pot while keeping the rest invested (known as drawdown) and your investments have taken a big hit, you may need to reduce the amount you take out of your pot to ensure you aren’t risking running out of money in retirement.
What it means for energy bills
Households in the UK could see an uptick on their energy bills in the coming months thanks to rising oil prices with many providers pulling their cheapest fixed deals in the past week.
There are currently 22 fixed energy tariffs available, compared to 38 a week ago, but in the past few days the number of deals on offer has risen slightly.
If you are not already on a fixed tariff and want certainty on your energy bills, you may want to consider locking in reasonable rates for a year or more to avoid volatility caused by global events.
Ben Gallizzi, energy expert at Uswitch, said: “Suggestions that the conflict could end soon may have calmed nerves around the world, and we’ve also seen the number of available fixed deals increasing.
“There are currently 22 fixed energy deals available across the market, with the number of tariffs increasing over the past week, up from 15 at the lowest point.
“The cheapest fixed tariff on the market is currently £1,646 for the average household, from Outfox Energy.
For those on standard variable tariffs – now the majority of households – prices won’t fall straight away.
This is because the Ofgem price cap – the maximum amount suppliers can charge you for each unit of energy and standing charge if you’re on a standard variable tariff – is assessed every three months and the level has already been decided for April to June.
The cap is currently at £1,758 but will fall to £1,641 in April due to a previous drop in wholesale costs.
However, it is widely predicted to increase after this, with analysts at Cornwall Insight suggesting it could rise to £1,801 from July onwards.
There are still a few fixed tariffs available that are similarly priced to April’s price cap but recent analysis by Stifel found the price cap could go as high as £2,500.
Experts have warned households to not feel pressured into taking a fixed tariff but suggested using a comparison site to ensure they are getting the best possible deal.
What does it mean for mortgages
Uncertainty around energy prices means financial markets are now expecting the Bank of England to hold interest rates at 3.75 per cent this month and perhaps even increase rates later this year if the conflict persists.
As a result, lenders have begun to increase mortgage rates with the average rates jumping to over 5 per cent whilst many major lenders pulled their cheaper fixed-rate deals from the market.
The average two-year fixed residential mortgage rose to 5.1 per cent on Friday, up from 4.87 per cent on Monday 9 March, marking the highest level two-year fixed rates have been at since 6 August last year.
Meanwhile, five-year fixed-rate mortgages now average 5.19 per cent, up from 4.98 per cent on Monday – the highest rate since June 2025.
Cheaper rates are still available – as little as 3.78 per cent – but first-time buyers or those remortgaging have been advised to seek advice soon.
Adam French, head of consumer finance at Moneyfacts, said: “At least 530 residential mortgage products have been withdrawn since Monday 9 March, representing around 7.5 per cent of the market, although the pace of withdrawals has slowed as the week has progressed.
“It’s unwelcome news for borrowers, as hopes of steadily falling mortgage rates have collapsed and given way to a much more uncertain outlook. The destination is now heavily dependent on how global markets and inflation expectations evolve in response to the conflict the Middle East.”
Richard Dana, founder of mortgage and savings platform, Tembo, said he had seen a noticeable surge in demand from borrowers who are keen to lock in lower rates before further increases take effect.
“Many prospective buyers are moving quickly to secure deals while they still can, particularly those who had already been planning to purchase in the coming months.”
Which lenders have increased rates this week?
HSBC – increased rates by up to 0.4 percentage points
Barclays – increased rates by 0.3 percentage points
NatWest – hiked rates by 0.16 percentage points
Santander – increased some of rates by up to 0.24 percentage points
Nationwide – increased fixed rates by up to 0.25 percentage points
Coventry Building Society – increased some rates on Monday
Principality Building Society – has pulled all two and five-year fixed-rate deals
TSB – raised all fixed-rate deals by 0.5 percentage points
Virgin Money – raised rates by up to 0.25 percentage points
Faye Church, senior financial planning director at wealth manager Rathbones, urged anyone with a mortgage deal ending to be proactive.
She said: “Those approaching the end of a fixed‑rate mortgage may benefit from securing a new deal early.
“Many mortgage offers can remain valid for up to six months, depending on the lender, allowing borrowers to lock in a rate without necessarily committing straight away — and still switch if better deals emerge.”