Aussie Finance Blog

Australian personal finance news, tips and advices.

Comparing car insurance

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What should you look for when comparing policies?

Cars are a big expense, especially when it comes to insurance. Whether you’re buying insurance for the first time or your policy is due for renewal, you should always start by comparing your options. But where to start? Here are five things you should consider when comparing your car insurance options.

The cost

Cost is the first point of comparison for people when comparing policies because it’s the simplest way to compare, ie policy A costs more/less than policy B. ... (read more)

Comfort Spending: How to beat the $1400 a year habit

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By Rhianna Dews, Money Writer at Mozo

Despite all the benefits that come with the digital world we live in today, its fast pace has ultimately led to a rapid increase in stress and anxiety, with Beyond Blue data revealing that 1 in 7 Australians are currently experiencing an anxiety condition.

What makes matters worse is the way in which Aussies are coping with the pressure. Mozo’s 2019 Comfort Spending Report found that Aussies are spending $1,430 each year on average in attempts to dilute stress, boredom and anxiety. This works out to a massive total of $25.5 billion each year! ... (read more)

Planning a Destination Wedding

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Compensation for this post was provided by OzForex Limited ABN 65 092 375 703 (trading as OFX). Opinions expressed here are my own.

Destination weddings have grown in popularity and are no longer just for the fortunate few. People travel more than ever, airfares are great value and the overseas destination could even be closer to home for some relatives. With the right advice and sound money management, planning a destination wedding becomes a very real possibility.

Australians are spoilt for choice when it comes to destinations. The entire South Pacific is located conveniently on our doorstep, and wedding groups appreciate the value and facilities of the resort islands. The lush surroundings and warm waters provide many wedding locations worth investigating.

Lots of people meet their future partner and even marry while travelling overseas. Europe and the United States are also favoured for destination weddings, and although more expensive, can also be the convenient option for some guests.

Planning a destination wedding isn’t difficult once you understand your own limitations. You will need to coordinate offshore wedding arrangements and financial transactions, so making certain your investment is in good hands is the first priority.Securing your wedding investment

A destination wedding usually involves purchasing a wedding package or using the services of a wedding planner. Wedding packages, often associated with larger resorts, can seem too formulated, but the exotic or exclusive setting should satisfy just about everyone.

A wedding planner, on the other hand, is able to tailor the wedding to your personal needs. It’s often best to hire a wedding planner who lives locally, speaks the language, and has existing relationships with vendors and service providers.

A destination wedding doesn’t need to be complicated, and neither should an overseas money transfer.is OFX money transfers are among the most popular, offering 55 currencies and paying to 190 countries around the world, with the ability to track the progress of your global payment.

Whether you need to send a one-off payment or staggered payments to various wedding suppliers, money transfers are normally completed in a couple of days, so it’s easy to keep a destination wedding plan on track.

The detailed wedding plan

Unless you have experienced local contacts, a highly competent wedding planner will be essential to get the most out of your budget. The destination is just the setting, and for the wedding to become all that it can, your spending and money transfers need to be targeted and secure. A wedding planner can assist in many ways, including:

  • venue hire and decoration
  • guest reception, limos, accommodation
  • photographer, DJ or band
  • catering, organising the wedding cake
  • coordinating the sequence of events on the day of the wedding
  • ensuring local events or other festivities don’t conflict with your chosen wedding day

The wedding can even become an extended vacation that takes full advantage of your chosen destination. Consider sailing, diving or day trips as an additional attraction for everyone’s enjoyment. An OFX money transfer can cover it all, or be used specifically for destination wedding essentials. This flexibility keeps you in control of spending and provides opportunity for extra spontaneity and vacation-style adventure.

Start planning early

There are lots of reasons why people choose a destination wedding. For some it’s an idyllic dream, while others have cherished memories of a favourite place. The location could be perfect for both sides of the family, or just a great way to do something a little different, create a party atmosphere, and soak up some tropical sun.

The earlier you get moving with the wedding plan, the easier it will be for your guests to make arrangements. Plan ahead to secure your dream destination wedding location, and send invitations out well in advance of the wedding day. If some guests aren’t able to attend, it’s worth considering hosting a second ceremony back home at a later date. In some cultures, this is already the expected practice.

The favourable climate of competitively priced accommodations, cheap international travel and secure money transfers is an opportunity worth taking advantage of. Destination weddings are now within reach of most couples hoping for an enchanting experience like no other.

For more information and to read OFX’s Product Disclosure Statement, please visit the OFX website.

Juggling your changing health needs on a budget

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The start of Autumn every year is a good reminder to make sure you’re on the right private health insurance plan. Why Autumn though?

On 1 April, premiums for health insurance rise by an average of 4.84%. So if you don’t take the time review your policy, not only could you be worse off financially but you could end up with the wrong level of cover – something that could cost you much more in the long run.

Luckily, it doesn’t take long to make sure you’ve got the right health insurance plan in place, and to ensure you’re getting as much as value for money as possible. Laura Crowden, spokesperson for iSelect, has a few tips to help you on your way:

  • Play the offset game. Many people who shop around ahead of April 1 find that they not only offset the premium rise by getting a better value with a new plan or provider but even save money. With many providers in the market, some are offering attractive deals in a bid to win your business. Just make sure you’re not sacrificing coverage for savings.
  • Make sure your policy suits your life stage and medical needs, especially if they are regularly changing. A careful review of your policy might reveal that you’re covered for the birth of a child, which is perfect if you’re trying for a baby but is a needless cost if you’re not.

    • ... (read more)

    Australian Car Sales for August 2014

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    The automotive market’s performance is not closely related to personal finance, unless you’re planning to buy a car or work in this industry. My article tries to summarise the latest statistical repots.

    Based on the monthly and yearly comparison reports of the Federal Chamber of Automotive Industries (FCAI), car dealers are having a tough time in Australia, especially in WA. The national year-to-date (YTD) average declines in vehicle sales was -2.5% in August 2014. Western Australia is leading this negative list with -8.3%, followed by Tasmania and Queensland with -7.1% and -5.4%, respectively.

    The report doesn’t have state specific statistics about vehicle types, but in overall “passenger” vehicle sales decreased by 5.4% year-to-date, as well as light and heavy commercial vehicle sales. The only growth was reported in the SUV market, +3.7% year-to-date. The FCAI report has more details about the passenger type vehicles. Micro, light, small and medium categories decreased, while large, upper large and people movers increased YTD. The sports category had a 7.8% decrease.

    In the SUV market, small SUVs had the best and only positive performance (+15.7%); therefore, the SUV market increased mentioned in the previous paragraph is due to the small ones. In overall, it’s not looking too good and it’s interesting to compare these numbers with the Australian automotive industry’s monthly product volumes. The FCAI website has data about the monthly production volumes and it can be seen that 14% less vehicles were built during the first two quarters of 2014 than the previous year. The product volume has been decreasing since 2013.

    The tough market situation might be good if you’re planning to buy a car, because you have a better chance to get a larger than average discount from car dealers. As far as I know, car dealers make profit on service, not car sales, so you should compare prices and fight for a good discount.

    Undateable debt: Why it pays to know your partner’s credit score

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    By Kate Browne

    Nothing unravels a blossoming relationship quite like a bad credit history. Seriously!

    Ok I know what you’re thinking “yeah right sure finance lady, it’s not about how you look or how you come across personality-wise or even if you are a dog or cat person it’s all about your credit report…give me a break.” And well that might be true, bear with me…. If you are going on a date it just might be worth checking your credit report – as well as the mirror – before heading out the door. ... (read more)

    How to Use an Economic Calendar to Trade in Forex Markets?

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    Every day countries publish economic reports, meetings of Central Banks are held, as well as governors give speeches. These events usually occur at a scheduled time. To keep abreast of the upcoming events traders use an economic calendar where the time of their release and the degree of importance are displayed.

    An important economic event can significantly change the market price of the asset in a matter of minutes. Traders respond to news reports in different ways. Some traders expect such news and recommend not to miss the opportunity to benefit, while others stop trading before the releases and wait for the market to calm down. ... (read more)

    The Importance of Funeral Planning

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    When it comes to aboriginal funerals, it is an event that is highly valued by the Aboriginal people. Often, ceremonies related to funerals can go on for several days and even weeks. In more intense ceremonies, the children might even be absent from school in order to take part in these very valuable communal events. The ceremonies include multiple dances and songs, which have their varied structures and meanings. In order for all these take place, the families will surely incur expenses. This is where the importance of funeral planning comes into the picture.

    Make a difference

    As humans, we are always busy making one plan or another, especially when it has to do with everyday, weekly, monthly, or annual events that bring us success and happiness. A higher percentage of people never take the time to consider funeral planning, whether for themselves or their loved ones. Although it is not a pleasant topic for thought or discussion, a funeral is a significant part of everyday living and should be given due attention. This is especially true when it comes to the financial aspects of conducting funerals, which might put a whole lot of stress on your loved ones on top of their grief.

    The importance of making funeral plans

    There are several reasons why you should consider a funeral plan, these include but are not limited to the following;

  • It Reduces Financial Burdens: Especially if you happen to be the breadwinner of your household. Knowing how much you love your family, it would surely break your heart to allow them to be saddled with the financial burden of handling your funeral. On the other hand, buying funeral plans for other members of the family also eliminates the issue of funeral costs, which might just add to the grief the family is dealing with.
  • It Makes Cash Available: Most times, it takes weeks and months of paper work before the dependants of a deceased person can have access to the funds left behind by the deceased. This however, will not be an issue if there is a funeral plan in place. With the beneficiary’s demise, payment is usually made within 48 hours, leaving the family members with adequate cash to start the burial preparations without wasting any time.
  • It Helps Loved Ones Get Closure: In the aboriginal culture, giving a loved one a befitting funeral leaves the loved ones fulfilled. With funerals being a part of the grieving process, a deceased person’s loved ones are able to find closure knowing that their departed family member was given a befitting burial. With a proper funeral plan, a person’s loved ones can bid them a heart-warming goodbye.
  • Other Funeral Expenses Can Be Settled: Depending on the type of plan opted for, the payout might go a lot farther in helping the family cater for other related funeral expenses. Some of these expenses include but are not limited to transportation for guests, the ceremony, the headstone, and other relevant aspects.
  • Additional Support Is Made Available: A good number of companies go the extra mile to offer more than just financial assistance to a grieving family. There are a variety of other kinds of support which includes but are not limited to legal assistance, bereavement counselling and proper organising of the funeral. This way, the family members are able to heal quicker and better from the loss of their loved one.
  • Availability of Future Financial Support: With a good funeral plan, there might be the option for offering the bereaved family a set financial support for several months after the funeral. This option is available to anyone who happens to be the breadwinner of his or her family. With this fund, the family are able to offset bills and certain necessities like food, rent, school fees, etc. Even as they try to find their feet and move forward again as a family.

    • ... (read more)

    How to Compare Mortgages

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    Whether you are getting set to buy your first home or you are preparing to re-mortgage your home, it is important that you do so with the best deal available. You don’t need to be an expert in using a mortgage repayment calculator before you can find a great deal out there. Instead, you need to understand some of the steps that would help you towards having your home mortgaged at the best rates.

     

    In order to avoid being ripped off, you need to take your time and compare mortgages from a few vendors. This needs to be done correctly, if you desire a good result. You should also understand that the type of mortgage you choose will go a long way to determine the rate you pay. Other factors that might impact on rates include your deposit, credit rating, and others. Listed below are some of the steps that would help you engage in successful and great comparison shopping. They are as follows:

     

  • Understand what you want; Before you take the first step of comparing prices, you should first determine what you actually want. Are you settling for a fixed rate mortgage or do you intend on going for a tracker mortgage? You should understand that since a fixed rate offers more security, the price tends to be higher than a tracker mortgage. It is your decision to make but guidance is available.
  • Compare related offers: In order to ensure that you get the best rates, whether you are proficient in using a mortgage payoff calculator or not, you should only compare related offers. Don’t compare the price of tracker mortgage from one vendor and go for fixed rate with another vendor. In doing this, you will only end up more confused and struggle to make an informed decision. Instead, make related comparisons. You should also know that even though your qualifications are not altered, different vendors will offer you different prices and terms. This is especially because they use varying business policies and models.
  • Opt for a Mortgage Broker: Most times, we just have to leave certain things for the professionals, including comparing quotes for a mortgage. With a broker, who is certainly more versatile with utilizing a bank mortgage calculator, you might just be able to land a great deal with a reputable lender. This broker acts like a middleman between you and the lender and depending on what you want, you can be matched with a lender that has loan products that expressly fit your home mortgage needs.
  • Go for Relevant Rates: One of the deciding factors when you are out there shopping for a residential mortgage is the amount you are able to deposit. This means that the rates you are offered when you are making a 30% deposit will definitely be better than the rates you will be offered when you are making a 10% or lesser deposit. When you understand this, you will surely not waste your time comparing quotes you will definitely not qualify for.
  • Work out your expenses: When you are comparing quotes for a mortgage, don’t just think about the mortgage deposit. There are other expenses you should be paying attention to as you get ready to use that simple mortgage calculator. Some of these expenses include but are not limited to solicitor’s fees, moving costs, property survey fees, etc. With this, you should be able to work out the level of deposit you can afford to put down.
  • Work out all costs related to the loan: In order to avoid any last minute surprises, you should take your time to work out every cost related to the mortgage loan. You want to know what you are getting into and as such, you should have a good knowledge of the monthly repayment amount, the interest rate, lender fees, and others.
  • Wrap it up: After you have made your comparisons, it is time to lock up your rates and get things wrapped up for good. Having made your calculations with the mortgage calculator, the next step is requesting a written “rate lock” from the potential lender. This is a form of written agreement that stipulates the interest rate, the interest price, and period of time it covers. With this lock-in, you are fully protected from any form of rate increase while your application is being processed. While some lenders go ahead and charge fees for the lock-in, others do it without any additional costs. It varies from one lender to the other.

    • ... (read more)

    Contactless payments statistics in Australia

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    Last month I published an article about contactless payments and it seems like it’s a hot topics nowadays because Westpac released its Visa contactless payments statistics for 2017.

    They claim that Visa payWave contactless payments increased to 325 million in 2017, which is a 25% uplift compared to 2016. There were 67 million more payments in 2017 than the year before.

    In the first month of 2017, Visa reported more than 24 million contactless payments, which by the end of the year increased to over 33 million.

    According to Westpac, contactless is the preferred payment method in over 90% of purchases and contactless generated more than 68% of the Westpac Visa cardholders’ total spend.

    It’s also interesting to see that St.George Bank (which is owned by Westpac) has higher contactless usage rate than Westpac. The ratio of contactless payments was 95% for St.George Bank customers, while 81% for Westpac customers, which clearly shows the demographic differences between the two banks’ customers. Also, Westpac customers spend 40% more on contactless credit card payments than debit card payments, which shows that customers are comfortable to use contactless payment for more expensive purchases.

    It seems like that the fast food industry is the leader in contactless payments (98%), followed by other kind of restaurants (96%), grocery shopping and discount stores (both 93%). Healthcare related payments had the lowest contactless ratio in 2017, only 59%.

    There are quite a few brand and technology names in the contactless payments system but the two most widely used technologies in Australia are Visa payWave and Mastercard PayPass (a.k.a. Tap & Go).

    I look forward seeing the 2018 report next year but there’s most likely an upper limit for contactless payments and they will never reach 100%.

    Here’s a link to the Westpac contactless payments article.