Rates are rising. Let's talk about what you can control.
When rates go up, it's easy to feel like the whole thing is happening to you. The Reserve Bank moves, your lender follows, and your repayment changes without anyone asking your opinion. But there's more in your hands than it might feel like right now, and a few small moves made early can take a lot of pressure off later.
We've put this together as a practical guide. Some of it is about your home loan, and some of it is about the rest of your household budget, because the two work together.
Start with where your money actually goes
Before cutting anything, get a clear picture. Pull the last three months of bank statements and sort your spending into what you have to pay and what you choose to pay. Most people find a few surprises, usually subscriptions they forgot about or small regular spends that add up to more than expected.
The Moneysmart budget planner at moneysmart website is a good place to start if you'd like a template. It's run by ASIC and it's simple to use.
Once you know your numbers, you can decide where the savings will come from instead of guessing.
Ask for a better deal. Then ask again.
A lot of household costs are negotiable, and providers rarely offer their best price unless you ask. A few places worth a phone call:
Energy. Compare your electricity and gas plans at energymadeeasy.gov.au, or Victorian Energy Compare if you're in Victoria. Take the best offer you find to your current provider and ask them to match it. Also check whether your state offers any energy concessions or rebates you might be eligible for.
Insurance. Home, contents, car and health insurance often creep up each year at renewal. Get two or three quotes before you renew, then call your current insurer and ask what they can do. Ask specifically about multi-policy discounts and whether raising your excess would make a meaningful difference.
Phone and internet. If you've been on the same plan for a while, there's a good chance a newer plan offers more for less. Call and ask to speak to the retention or loyalty team, as they usually have more room to move.
Subscriptions. Streaming, apps, gym memberships, software. Cancel what you don't use. You can always sign up again later.
Council rates and water. Some councils and water authorities offer payment plans or concessions for pensioners and people doing it tough. It's worth checking your council's website.
Fuel and groceries. Your state's fuel price app can save more than you'd think over a year. At the supermarket, check the unit price on the shelf tag rather than the sticker price.
Now, your home loan
This is where the biggest savings usually sit.
Ask your lender for a sharper rate. Lenders often offer their best pricing to new customers, which means loyal borrowers can end up paying more than they need to. Your lender's retention team has the ability to reprice your loan, but they won't usually do it unless prompted. This is something we do for our clients regularly, and it's often a quicker win than people expect.
Consider whether refinancing makes sense. If your lender won't move, it may be worth looking elsewhere. Refinancing isn't right for everyone, and the numbers need to stack up once you factor in everything involved in switching. That's exactly the kind of thing we can work through with you.
Use your offset account properly. If you have an offset, every dollar sitting in it reduces the interest you're charged. Having your pay go straight into your offset and paying expenses from a credit card you clear in full each month can help, as long as you're disciplined with it.
Keep your repayments up if you can. If your rate has risen but your budget still has room, try to pay a bit more than the minimum. Any extra you put in now builds a buffer you can draw on later if things get tighter.
Thinking about fixing?
Fixing your rate gives you certainty. You'll know exactly what your repayment is for the fixed period, which can make budgeting much easier when rates are moving.
The trade-offs are worth understanding. Fixed loans usually limit how much extra you can repay, often don't come with a full offset, and leaving a fixed rate early can be costly. If rates fall during your fixed period, you won't benefit.
Many of our clients choose to split their loan, fixing one portion for certainty and leaving the other variable for flexibility and offset access. There's no single right answer. It depends on your plans, your cash flow and how much certainty matters to you.
If your fixed rate is due to roll off in the next six months, please get in touch now. The rate your loan reverts to is often not the sharpest one available, and planning ahead gives us time to find the right option.
If things are getting hard
If you're worried about keeping up with repayments, please don't wait. Lenders have hardship teams, and speaking to them early gives you far more options than speaking to them late. Options can include a temporary repayment reduction, extending your loan term or a short repayment pause.
The National Debt Helpline on 1800 007 007 also offers confidential financial counselling at no cost.
And of course, you can always talk to us. We'd much rather have that conversation early.
Let's review your loan together
A lot of what's in this article is easier with someone in your corner. We can meet face to face or online, share our screen and walk you through your loan, your options and the numbers side by side so you can see exactly where you stand.
Warm regards,
Kate and the team at The Broker Society
