When it comes to money, the past few months haven’t exactly been simple. We’ve seen interest rates jump, the cost of living go up, and the sharemarket bounce around.
With the new year upon us, it’s a good time to check in on your finances and see whether things need to be adjusted for 2023. Here are a few ways to get started.
1. Revisit the budget – or start one
If you have a household budget, it may need a bit of tweak to take into account interest rate changes and the rising cost of things like food and petrol. There may be other categories within the budget where savings can be found.
If you haven’t got a budget, the new year may be a great time to start one, especially if you’re planning to save for a holiday, a big event or a long-term goal. Check to see whether your bank has any budgeting tools you can use.
2. Be sure you’re making the best of your mortgage or rental situation
Both home loan rates and rental prices have risen steeply in 2022, but as a dweller, you can sometimes get a better deal.
If you have a home loan, speak to your bank about whether there’s anything more you can do to save – such as getting a rate discount or features like offset and redraw accounts.
As a renter, you may be able to negotiate. Landlords have been known to offer discounts for things like giving up a car space or freeing up the property at certain times of year for holiday rentals.
3. Look at your savings rates
When interest rates go up, borrowers’ pain can sometimes be savers’ gain. Check to see if you’re on the highest interest rate your bank offers; sometimes there are additional benefits if you make regular deposits or don’t make a withdrawal for a set period of time.
4. Check in on your super
While most of us won’t use our super until retirement, it’s worth keeping an eye on. Paying extra fees or having money sitting in a poor-performing fund can be costly.
The Australian Taxation Office now lets you compare super funds to see if the returns and fees meet your expectations. If they don’t, it’s pretty easy to switch these days.
Remember to look for lost super via MyGov, too.
5. Think about debt
If you’ve got credit card, personal loan or car loan debt, the new year could be a good time to check whether your strategy for paying it off is working. If the interest on your loan is on the high side, you could think about refinancing to another lender.
If you decide you need a more comprehensive finance check, you can speak to a financial planner.