The words on everyone’s lips, a news feed, and all over social media.
Yes, interest rates are rising and will continue to rise over the coming months.
The cost of living has increased, and lettuce is $10… It’s not a new thing.
Flashback to the 1970s
The 1970s proved challenging for motorists around the globe, with the war in the middle east sparking an oil crisis that led to high fuel prices and fuel rationing in many countries.
Fuel shortage fears led to smaller cars, including the Holden Commodore, which replaced the large Kingswood sedan.
Then, Treasurer John Howard used his budget to dramatically raise fuel taxes saying Australian fuel was too cheap and his tax prices increased fuel prices to around $0.21 per litre.
So, what’s my point:
- Be prepared.
- Understand your current situation.
- Be proactive in moving your own situation forward, be your own cheer squad.
The general feeling seems to be one of gloom and doom, but it really is a great opportunity or a wake-up call, whichever way you want to look at it. To have a good hard look at what you are spending and how much it is costing you.
Do you know what you spend your pay on every week? That’s called a budget.
Are you spending more than you earn? That’s being in debt.
How much is your debt costing you? That’s the interest rate the lender is charging you to borrow their money so that you can have it now.
What happens when things start to cost more than you expected including your mortgage? That’s stressful and can lead to mortgage stress.
My thoughts – take some time, without all the noise
Do a budget, look at all your debt but look a little closer and see what price you are paying for that debt.
Then put a plan in place for the items you can control and don’t worry about what you can’t.
Firstly, show yourself a little kindness, and congratulate yourself for not burying your head in the sand.
- Revise your shopping can save on items.
- Compare utilities: insurance, power, phone, gas etc.
- Talk to a broker about debt consolidation or a simple refinance, not only could this help your cash flow but reduce your interest rates. Your broker can help you to put a strategy in place for your whole financial position for now and in the further.
- Talk to a counsellor – don’t shoulder the burden by yourself.