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Act now: 4 tips to protect your money

·4-min read
Complication image of stethoscope on blue background, shopping trolly, pile of cash and hand touching gold egg among white eggs
Wages have increased 2.5 per cent to help with rising cost-of-living. (Source: Getty)

It’s a new year and it needs to be a new (financial) you.

A lot changed in the lead up to the clock striking midnight on June 30 this year.

Here’s what you need to know… and, crucially, do.

Inflation and interest rates

Inflation spikes mean interest rate hikes, and they have already begun flowing through to mortgage holders with an average variable rate of 4.15 per cent.

Nine-in-10 of the experts and economists polled for the monthly Finder Reserve Bank of Australia (RBA) Cash Rate Survey believe there will be a further interest rate increase at July’s meeting.

One-in-three believe we will the same again next month.

Read more from Nicole Pedersen-McKinnon:

And many expect a multiple – rather than just a 25-basis point – move.

The RBA has made it very clear that it is time to normalise interest rates and will act decisively to try and contain an inflation rate that may be headed for seven per cent.

A double rate rise this time around would take repayments on the average $611,158 Aussie mortgage to $3,151 a month or $37,816 a year, says Finder.

That’s $424 and $5,088 more, respectively, than just three months ago.

What you need to do: Those repayments are based on a variable rate of 4.65 per cent after a predicted 50 basis point rise next week. But, also assuming a 50 point rate rise, the cheapest, quality product in the market (so with a real offset account) would still charge only 3.1 per cent.

Ditch and switch to that loan, from Well Home Loans, and the average mortgage holder would be paying less even than before rises commenced – from $2,727 before this ‘dramatic’ hike cycle to just $2,610.

The monthly saving from such a refinance versus the forecast rate by Tuesday is an instant $541.

What about talk of falling house prices? Provided you can continue to meet repayments, just ignore it. Until you crystallise it by selling, the value of your home is on paper only.

If you are a first home buyer, however, 40,000 more places have just opened up in the Home Guarantee Scheme that allows you to buy with a deposit of just five per cent (two per cent if you are a single parent) without paying Lenders’ Mortgage Insurance (LMI).

Just be sure you are not buying – with such a small equity buffer – at the top of the market.


From July 1, the national minimum wage was up by 5.2 per cent in recognition of the higher cost of everything from power and petrol to petite leaves.

That represents more than an extra $2,000 a year for some of the country’s lowest paid workers.

Family tax benefit Part A and B also increases from today.

On the downside there are no more $750 Federal Government pandemic payments if you have to isolate.

What you need to do: If you are on the minimum or an award wage, you need to check you are getting what’s yours.

If you are instead on an individually negotiated pay rate, when was the last time you had a review and renegotiated? If you are confident of your contribution to the company, the cost-of-living increases are good justification.

And don’t miss that the labour market is the tightest it has been in more than 50 years so if your employer doesn’t act to keep you happy, consider your alternative employment options.


The amount of super to which you are entitled has also gone up, by 0.5 per cent to 10.5 per cent.

Government modelling suggests this will increase the retirement savings of the average worker by $15,000.

It’s the next instalment of a rise to 12 per cent by 2025.

In further good news, you no longer need to earn at least $450 a month from the one employer to get it.

This ridiculous rule was a relic of a more onerous, pre-digital administrative time.

Its removal is especially good for parents (still the majority of whom are women) phasing back into the workforce as they also care for kids.

What you need to do: Again, make sure you are receiving your full entitlement.

Health insurance

Fresh off the scramble to make the most of tax year 2021-22, you may have realised you will face a Medicare Levy Surcharge (MLS) of up to 1.5 per cent.

This is levied on singles with incomes of $90,000 or higher and couples on $180,000-plus… if they don’t have private hospital cover.

What you need to do: The thing is the MLS penalty – for example, it’s $1,000 on an income of $100,000 – would buy some pretty decent insurance.

But you need it in place for the full 365 days of the tax year to entirely avoid it.

Instead of getting caught this year, get covered today.

Nicole Pedersen-McKinnon is the author of How to Get Mortgage-Free Like Me, available at Follow Nicole on Facebook, Twitter and Instagram.

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