What are your goals for 2016? After the excess of the festive season, now is the time to set your budget for the year.
The biggest issues for home owners in 2015
With house prices rising in Sydney and Melbourne, there is now more attention than ever on the Brisbane market. This means that as a buyer, you really need to do your homework when looking for a property. APRA’s changes to investment regulations made it harder to secure investment loans, mostly affecting first-time property investors. If you want to purchase an investment property, you can currently expect to hand over a larger deposit and pay higher interest rates.
New Year budget resolutions for 2016
To save money on your home loan
- Make repayments fortnightly rather than monthly
- Don’t reduce your repayments if interest rates decrease
- Consolidate debt into one loan
- Consider refinancing to get a better deal on interest rates and loan features
- Take advantage of an offset account
- Put extra money into your loan where you can
To save for a home loan deposit
- Place your savings in a high-interest account that penalises withdrawals
- Try to live on one wage and save the other
- Make a list of things you can live without – such as coffee and gym memberships – and stop spending money on them
- Pay off your credit card and live off your salary only
- Reduce the amount of cash you keep in low-interest transaction accounts
To save for retirement
- Consider salary sacrifice to save on tax
- Investigate if you have any lost super
- Work out whether you should be putting money into your mortgage or your super
- Decide whether a transition to retirement pension will benefit your retirement plan
Taking control of your finances
Getting ahead doesn’t mean you have to work harder than ever before (although that certainly helps). Being smarter with your money and diligently sticking to your resolutions will put you on the right track. Wealth is built by seeking new opportunities, so use 2016 to put yourself in a position to save more, purchase that investment property or put down a deposit for a home. By defining your goals and writing them down on paper, you’ll be more motivated to work towards them.