Show them you’re in charge

Here are seven ways to get your finances off to a flying start.

• Change your password

Security experts recommend changing your password on your online banking account at least four times a year. Is it a chore? Absolutely. Is it worth it? Yes.

Banking scams reached new heights last year and all it took was a bunch of cybercriminals getting hold of your sensitive data through social media or through online sites you may have visited. This year could be the year you use a password manager or a system that allows you to update your passwords more frequently than you’ve done in previous years.

• Check out the AFCA website

The Australia Financial Complaints Authority is the go-to organisation to get compensation from a bank that made a serious financial error or acted inappropriately towards it’s customers.

It can resolve your complaint before you escalate the matter to court. Since 208, it has helped more than 300,000 Aussies get $900 million in compensation and refunds. Some of the complaints it has resolved include unauthorised transactions, delays in insurance claim handling and denial of insurance claims.

• Automate payment on your outstanding credit card debt

Plastic is fantastic if you can clear your debt on time each month, but with the average credit card debt sitting at around $14,000, it looks like many of us err on the generous side. Time to keep the card on ice for 11 months and set up an automated payment until you get your debt balance to zero. Many banks also offer balance transfers with zero interest rates for a set period. This is another way to reduce your interest bill.

• Re-negotiate your home loan

An oldie but a goodie. If you haven’t switched home loans or banks for two year, you are definitely leaving money on the table. The difference between the interest rates offered by the big four banks can be anywhere between 0.5% and 2%, depending on your creditworthiness. According to the home loan platform Lendi, a reduction of 0.5% (dropping from 4.3% to 3.8%) in your interest rate on $800,000 could mean saving more that $82,000 over a 30-year term.

• Seek financial assistance if you’re struggling with your payments

More Australians are under mortgage stress as a result of the interest rate hikes in 2022. Those who have been hit by the triple whammy of higher mortgage repayments, job loss and natural disaster (if they were affected by the floods) are in for a terrible year. But banks have financial assistance programs for those who are in tough circumstances.

Information on counselling services or relief packages offered by various institutions can be found in the financial assistance hub on the ausbanking.org.au website.

• Sign up to a rewards program

Some banks are offering as many as 100,000 frequent flyer points on new credit card applications. While this was fairly rare in previous years, the deals have become more common.

The tick is to make sure you are not spending more just to rack up the points. Dedicated websites such as pointhacks.com.au can help you become more savvy about reward point while avoiding the usual traps.

• Open a savings account or term deposit

With interest rates languishing around zero for many years, many banking customers have snubbed classic savings accounts or term deposits. But the cash rate has returned with a vengeance in 2023. Westpac is offering up to 4.35%pa for young customers (age 18-29) while ING’s Savings Maximiser is offering up to 4.55%pa.

If you have more than $10,000 in cash that you don’t need for 6 months to a year, you might want to get a better deal and put it in a term deposit.

Credit: Article ‘Show them you’re in charge’ by Michelle Baltazar, Money Magazine February 2023 edition.

If you have any questions about implementing the above recommendations, please contact our team.