Mixed messages over interest rates

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2 Mixed messages over interest rates In February, the Reserve Bank of Australia cut interest rates to 60-year lows, and economists remain divided over whether rates will fall further still. The trouble is, interest rate predictions are always wobbly at best. This was highlighted when an unexpected fall in unemployment figures in early January prompted many economists to revise their forecasts of lower rates. While rate movements can be unpredictable, there are simple but important steps we can all take to manage swings in interest rates. A sensible starting point is to contact us for a review of your home loan. A quick Home Loan Health Check can identify weak spots in your home loan management plan. You could benefit by refinancing to a new loan, or it may be time to consider splitting your loan between fixed and variable rates. The main point is that by taking action now, you can rest assured that you have charted the course that is right for your circumstances regardless of what happens to market interest rates.

3 Get yourself financially fit Are you struggling to pay off your debt? In this article we look at the best ways to rid yourself of debt and become financially fit. Many of us start the New Year with the best intentions. We tell ourselves that this is the year we are going to rid ourselves of debt. Then, seemingly, life gets in the way, the months disappear and we find ourselves at the end of another year having done nothing to improve our financial fitness. Thankfully, there are a few simple tips you can implement to help you become financially fit. 1 Research lender options With lenders keen to attract new business, many are offering some significant incentives to customers, including free usage of any ATM in Australia, and even cash-back bonuses. So what have you got to lose? Ask how we can help you research your options to see if there is a better financial institution out there for you. 2 Compare to find a better deal You may be paying more than is necessary on your home loan, insurances, utility bills, etc. Comparing your options via your mortgage broker or websites like HelpMeChoose.com.au can help you find a deal suited to your needs, and may see you save money. 3 Bundle up your expenses There is no need to completely cut off your internet or pay-television to save money each month. Bundling several services together could save you a small fortune. You may also consider lowering your data limit or package inclusions to help trim excess expenses. Any savings, big or small, can then be contributed to your home loan to save even more over the long term. TIP! Our free home loan Health Check is a smart option Our free Home Loan Health Check lets you know if your loan is still right for your needs. The home loan market is more competitive than it s ever been. Even if you ve had your current home loan for only a couple of years, it s possible you could take advantage of different loan features or even secure a lower rate. Both could help you save money! Contact us today to book in a Home Loan Health Check to see if we can find you a better deal.

4 Five must-have insurances Give yourself - and your family - peace of mind with these essential forms of protection. At Mortgage Choice, our brokers and financial advisers work together to help you choose the insurances that will protect your lifestyle - now and in the future. Let s look at the five types of cover that we believe are at the heart of a sensible financial plan. Home and Contents cover This one s non-negotiable, especially if you have a home loan. Most home owners have home insurance in place but many people don t have sufficient cover. Your home is likely to be your most valuable asset don t risk it with underinsurance. Income Protection insurance The income from your regular wage or salary income is likely to be a key factor in your ability to build wealth, grow financial security and enjoy a rewarding lifestyle. Income insurance offers vital protection by providing regular payments usually worth 75-80% of your normal wage or salary if you can t work because of illness or injury. The premiums can normally be claimed as a tax deduction, which helps to lower the cost. Total and Permanent Disability (TPD) Let s face it: a disability pension is likely to be a lot less than your regular income. TPD cover can help you meet expenses like rehabilitation, home modifications and even carer fees to help you rebuild your life. Life insurance Here s the big litmus test for life cover. If you or your other half passed away unexpectedly, how would your family manage financially? Many Australians have some level of life cover through their superannuation fund but it s vital to check if that is enough. Having adequate life cover in place means you don t have to worry about the risk of your family experiencing financial distress. You work hard for your current lifestyle. Don t leave your future to chance. Talk to us about a review of your insurance cover to make sure your wealth and family are protected. KNOW THE FEELING Critical Illness (Trauma) Trauma cover pays an agreed lump sum if you suffer one of the serious illnesses or injuries noted in your policy, like heart attack or cancer. It s money that lets you focus on recovery rather than your finances.

5 YOUR QUESTIONS answered What is the Medicare Levy / Surcharge? Less than half of Australians have private health cover [1], but bypassing health insurance can be false economy, especially if you re a high income earner. Without private cover, you could be hit with the Medicare Levy Surcharge (MLS). The MLS starts at an extra 1%, rising to 1.5% of taxable income. What s more, it s in addition to the 2.0% standard Medicare Levy all taxpayers pay. If you re single and you earn over $88,000 this financial year, or your family income exceeds $176,000, you could be asked to pay the MLS if you don t have private health insurance. Taking out basic health cover can be cheaper than paying the MLS, so looking into this option is worth your time. What is LMI? If you borrow 80% or more of a property s value you will be asked by your lender to pay lenders mortgage insurance (LMI). You won t have to shop around for LMI: your lender will arrange it, and you can choose to pay the premium as a lump sum or you may be able to add it to the loan (known as capitalising the cost). Importantly, LMI protects the lender not you if you can t keep up the repayments and the lender ultimately incurs a loss on the loan. But without LMI, many home buyers with a small deposit wouldn t be able to secure a home loan. So while it s always worth saving a decent deposit, LMI could be the key that gets you into your own home. [1] Private Health Insurance Council of Australia industry-statistics/data-tables-membership-and-coverage/ Let us help you find the answers to your finance questions.

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7 Style tips to create impact in your kitchen by Shaynna Blaze There are two very well known sayings about kitchens: the kitchen is the heart of the home and kitchens sell houses so it is important to pay attention to the look and feel of this area. Here are some tips to help create kitchen wow factors. Splashbacks These are crucial to the final look of your kitchen so focus on the materials you use. Mosaics can create a classic look with just one feature colour or you can use gradient colours for an impressive statement. Textured or plain tiles with contrasting grout is an economical way to create drama and tiles with a Moroccan pattern can change a very simple kitchen into an earthy and welcoming space. Appliances Be adventurous with your styling with coloured appliances, like blenders, kettles and toasters. However if you have gone for a bold splashback, keep accessories simple so you don t create a cluttered look. Lighting Completely change the look of a white kitchen with a dramatic pendant light or group of lights. A stand-out lighting arrangement with copper, timber or coloured glass will add a softness and texture to a very minimal kitchen design. Shaynna Blaze, Interior Designer and judge on The Block and Selling Houses Australia Picture credits: Design your Home, Penguin, Shaynna Blaze