Hello and welcome to It All ends up the podcast where we chat about money, how to get it, how to spend it and how to invest it. I'm money editor Dom.
Powell, and I'm senior economics writer Jess Irvine, and this is our final episode of the year. Dom I can't believe we've actually this is our 17th episode. Time flies when you're having fun.
17 It feels a bit like I feel that we should have finished it on a round number. Obviously we didn't plan this very well, but 17 just feels like it's, it just sort of irks me a bit. But seven it's a lot. We did a lot of episodes.
It's a bit random, but yes. No, there's been some excellent if I do say so myself. Episodes that we produced. Did you have a favorite so far?
I think my favorite was the one we did on Hacks. I really enjoyed doing that one. If you have a listen to it, go back and listen to it. But I think it's just sort of one of those things that we're in a very unique sort of situation where inflation really does matter if you hexed it. So talking about it, thinking about it, I think is really important.
Yeah, my favorite one we've done so far was on pay rises and I think it's a sensitive topic for a lot of people. Nobody wants to ask, but it's just so important that you ask in the New year. And we're taking a little break, but we're going to replay over the summer some of our best hits, including the next one and including the pay rises ones. So you will still be getting little snippets from us dropping into your podcast feeds in the coming weeks ahead while
you're sunning yourselves at the beach, hopefully. And yeah, we're looking forward to reading some of those for you.
Yeah, it's sort of sort of like a greatest hits, you know, those so fresh CD's that everyone used to get back in the day. It's like a so fresh hits of hits of this podcast. 2022.
Yeah, it's probably a bit premature for our greatest hits of all time. I don't think we've been going on.
No, no, I think it's fun. I think it's all right. I think bands, bands are a great asset album for being around for like, you know, five years. So. All right, we're getting that this week. We're rounding off 2022 with some advice to get you prepared for next year and thinking about what it sort of means to sort of have, you know, to be financially successful or maybe not even successful,
just sort of financially stable in in 2023. And just what does that what does that mean to you when it sounds what does that sort of concept look like when we're going into the new year?
Yeah, I mean, many people would think that's having a lot of money to be financially successful. I just need
to have quite a lot of money. But for me, it's sort of just I mean, it's something that has evolved in my own life over the last couple of years, but just having a sense of being in financial control and actually when they do sort of studies of wellbeing next to, you know, having healthy relationships and a sense of purpose in life, having a sense of being in control of your money is one of the major predictors of whether a person is going to feel well or not.
So it's it's really important and, you know, it's going to be a stressful year for many people. In 2023, we've got the rising cost of living that is still going to be an issue. And of course, particularly for people with mortgages, we're going to be hit in the face with a lot of rate hikes, particularly if you're on the fixed interest loans as I am. My fixed rate expires in June next year. So I will be confronting a doubling, if not more, in my interest rate
when that happens. So I think I would just like for people to think through in advance what some of the issues are going to be around their finances and try to get ahead of the game a little bit just so that you feel in control of your finances? Yeah. What does financial success mean to you, Don?
Yeah, well, I think I'm sort of in the same boat. I think it's less that around having a big lot of money, though. Obviously that's nice. But, you know, I think it's more just about not being concerned or not being worried or at least minimising your level of concern of worry, worry about your finances and just sort of being prepared for the whatever, whatever the world throws at you. And by by golly, is throwing a bit at us at the moment. You know, there's, there's a little bit
going on and has been for a while. So I think I think it's just more that sort of level of stability that's that's sort of what it what it means to me. And I think that's what we should all be aspiring to or hoping to aspire to.
Yeah. And are you and New Year's resolutions sort of person?
Look, not really. I have to say, every now and again I think about making New Year's resolution. But, you know, I just sort of I just sort of let it go. I sort of go with the flow sort of guy.
You know.
This is the year into my yang, which.
Is that I have rigorously.
Since I started writing at the Herald, I think been set setting myself New Year's resolutions. I once had a New Year's resolution that I was going to save a dollar for every for every dollar that I spent or something. I was going to do a minute's exercise or something. I have a sort of dual purpose to sort of have health and money related.
So that's what that.
Seems to say to.
Me, like.
It was some sort of motivation to get me to exercise or something.
It didn't like that. That was that would be.
So many minutes of exercise. Like, obviously that's great if you could do that, that's amazing. But like, say your mortgage is like, you know, two grand or something. That's 2000. It's an exercise.
Well, I mean, read.
That over a month. I don't know.
Yeah.
Then read everything else on top of that that you spent.
I don't know. It was.
It sounded admirable, Jess, but I think. I think that might have been a bit far fetched.
Over the decades, that's evolved to this year, My financial resolution was just to track every dollar that I spent, and I did that. So. And that is actually something I've embedded into my lifestyle, is just to be a tracker of where my money is going. And that's actually my number one strategy. And thank you for indulging me and letting me kick off with this one as our strategies for people, because I think a lot of people would take that is to Mickey Mouse. I'm beyond that.
I don't have time for that. I don't want to do that. But I am. Having said that, I'm just surprised since I've been writing about tracking my spending, the number of people and readers and listeners who contact me go, Yeah, I've kept a spreadsheet of every dollar I've spent since 1974. You know, for some of our older listeners, it's actually
something that is quite common to do. And if you are feeling scared or worried about your finances for 2023, just one really simple practical thing you can do is to start to pay closer attention to where your money is going. I have my own spending tracker that I use. You can find that through my Instagram money with Jess play along at home with. Exactly. I just have a sheet of paper and I write down coffee for dollars. You know, the utility bill for water, which is quarterly,
you know, $250. And I track everything. So I have that visibility about where my money is going, and that helps me to plan for where I want to go. And that's been an absolute revelation for me in my life. And that has given me that sense of control that I think a lot of people are going to be looking for in the year ahead because things are moving quickly and you're going to really need to be reviewing a lot of your expenses to see if you can keep up, you know, with the mortgage or whether it's
the rent going up. And, you know, I would just like to be the person in the world who normalizes that and just to go, yeah, it can be as simple as track your spending, find out where your money is going. And lots of us are doing it. Not Don. No.
No. Here's the thing and again on the into to Jess's yang on the on the guy this is out here and it's not not budgeting at all it's like shooting from the hip. Yeah I look it's great because it means that we get to see both sides of the coin. But I mean, that being said, I lived this way. It may not be the best way to live. I'm sure it's probably better of you if you do actually think about things and plan and budget things a bit more than I do. I think that Jess's strategies
are well-worn and and seem quite, quite good. So, you know. Yeah.
And you don't seem particularly stressed about your money either. I think it's sort of if anyone is feeling that agitation and fear, it's sort of an exposure therapy thing about just a way to steer your money in the face of sort of if it's scaring you. Take a little look.
Absolutely. And I think that sort of brings us to the our second tip, which is sort of around thinking about the things that are coming up this year, namely refinancing, because obviously, as just mentioned, there's going to be a lot of people coming from fixed interest rates to, you know, probably onto a variable rate, which is going to be likely to be a lot higher than their fixed rate. So that will be sort of a cascading effect for
a lot of people. There's this sort of talk of this fixed interest rate cliff, which we are approaching and
will approach in 2023. So I think the best idea for that for anyone that's sort of in that boat is just to get ahead of it and really think about it well in advance, probably at least two months before your fixed period expires and have a bit of a look around and all those there's many, many, many comparison websites where you can sort of look at the best deals and the best offers and think about what sort of variable rate you're going to move on to
and what sort of benefits you can get. Like, you know, there always there are always people out there offering big packages of cash. Cashback offers a very popular and have become increasingly more popular as lenders have been sort of fighting for for people's money in people's business. So definitely some things to look in the into the just.
Yeah and one of the trends that seems to be becoming entrenched and I think will continue for 2023 is the banks are sort of not too backwards in coming forward and saying, you know, they are offering lower interest rates to attract new customers. So the new customer variable rates are lower than the existing customer variable rates. You know, the incentive, they are trying to steal customers from each other.
And if you can put yourself through the effort of refinancing and it can be a bit of can be a bit of a hassle depending on how complex your situation is. But there will be cheaper rates for new customers. And the best way to get them is to become
a new customer. I, I have a sort of I don't endorse anyone, but I do like to look at there's an online only lender called Tick tock not tick tock the queue for the kids, which I'm on by the way but TikTok and I was just check what they're variable rate they've got a 4.61% comparison rate offer with with a mortgage offset and I. Like to check in. So if you're sitting there and your mortgage rate is already at a five plus, do just know that there's
probably some cheaper rates for you. Another one that came up I looked on right city dot com Heritage bank was offering 4.69% going into Christmas plus the $3,000 cash back not endorsing any of those but just to let you know there's banks this heaps of lenders out there and probably ones you've never heard of before and this is the time to go looking for for a better deal.
And with a note that some people are going to find that difficult because they will have seen the equity that they have in their home decline with house prices. So if you've gone over that 80%, Elvia, because house prices have come down, it may be more difficult for you to refinance because you might be paying Lynda's mortgage insurance when you do. So for people who are sort
of in that situation are stuck. The best piece of advice I can offer you is if you're negotiating with your current lender, just ring them up and say, you know, don't mention about the LVR stuff because they wouldn't figure that out until the sort of mortgage application process where they would value your property just sort of come in strong and ask for a mortgage discharge form, which is
the magic words these days. That's the form that tells them that you're very serious about switching to another bank and see how you go with that. But it is going to be more difficult for people who who've recently bought and the value of their property has come down. So they haven't quite got as much equity. So refinancing is going to be difficult, but yet about two months out from when you fix is ending, that's when you want to be thinking in 2023 about refinancing.
Yeah, you've got to scare those banks, you know.
You've got to play the game, but you know, keep.
Them on their toes. They keep us on their on our toes. So, you know, you should. Yeah. Yeah. Like he's, he's sort of scary. You call them often like, oh, when a malicious judge, when you know, who knows what'll happen. Maybe they'll offer you a big fat wad of cash to to stay that happen to my sister and she ended up staying with the lender that she was already with. So.
You know, getting cash back to stay with your existing lender.
It's insane. Like they just so desperate to keep people on the books that they will they will go to the ends of the earth. Well, not quite. But, you know, they will do a lot to keep you around. So it's definitely worth milking that.
Yes. Ask number three strategy for 2023 is to review your insurances. And people ask me like, oh, yes, I need to save some money because interest rates are going up. And I say review your insurances. And they say, what about another tip? Because that sounds really boring, but this is actually a great time of year. We've got a little bit more time on our hands, you know, do spend a lot of time at the beach. But if you've got an extra hour or so to call up
your insurance company. So I'm thinking your car insurance, your home insurance, your health insurance, and then if you've got any forms of the life insurance TPD and sort of income protection insurance, make sure that you know at least what you are and are not covered for. And know that if you do sort of scale back some of the coverage in ways that you're comfortable with that will
reduce your premiums. So just having a look at each of those insurance policies, you know, reading some of the finer details because, you know, we talk about, you know, don't drink coffee or don't, you know, your Netflix subscription. But if you want to save sort of in the tens to hundreds of dollars per year, your insurance contracts are one of the best places to start for some
of the more substantial savings. So you might be able to keep your coffee and, you know, keep your Netflix if you sort of maybe look at your car insurance and, you know, increase the excess on that perhaps, which is a strategy I love, which means you're more exposed to paying the higher excess out-of-pocket in the event that you do make a claim, but it makes your premiums cheaper.
So particularly if you're someone with a bit of cash set aside to cover, you know, a rainy day expense like that, and you can afford to pay the higher excesses that's going to save you. It's going to help your cash flow in the in the immediate term. So that can be a really great strategy for saving, I reckon.
And again, look, you could even do this while you're at the beach. Pick up the phone and just give them a call. Get on the blower, go talk to your insurer and see what they'll offer you and see what they'll do for you. Because again, everyone's everyone's in the same sort of boat and there's deals out there that you can get that may not be immediately obvious. So getting on the phone underrated I'd say in in 2022. Yeah.
And legit to say I don't have enough money. I'm feeling the cost of living pressure and just come at it fairly directly and I think that's totally fine. There's no shame in that. We're all feeling that go go for it and just haven't got the money to afford this. How can I make this cheaper? And they might come up with some strategies for you or just a better deal.
Yeah, absolutely. And my, my fourth tip is sort of a bit of a crusade I've been on during the course of these 17 podcast episodes, which is making life easier for yourself through technology and other things. I've said this a number of times. Regular listeners will know this. I have like a bank app I'm with like a new fangled digital bank. It's. It's made banking is made
my finances like far, far easier. And I know that there are people out there who are still sort of with, you know, that whatever bank they've been with for 30 years and their parents or whatever. It's not that hard
to switch banks. It's really not that hard. You have to it does take a little bit of a bit of time, but it is worth doing because sometimes this the quality of life that you will get from a newer bank or perhaps a different bank with some sort of newer technology, like there's loads of them out there. It's just it's just so good. It's so good.
This happened with my super fund recently. I switched super funds and I didn't realize what I was missing out because the new fund has like an app where I can check my balance. I used to have to log in through a web browser and see in it, and it tells me and maps my, you know, past contributions. And it's just a lot better.
Yeah, absolutely. And this is you.
Don't know until you switch and see what else is around.
And this is happening across the board, like I'm talking about the bank banking app because obviously I use it every day and it's very front of mind. But like pretty much every single thing that may like, you know, look at anything in your life that you may have been using for a very long time or been with for ages. And just think about ways that maybe, oh, maybe there's a better way to do this, or maybe there's a new way to do this, especially with something
to do with your finances. Like, it's almost like it's like disrupting yourself. If we're going to use some real Silicon Valley sort of, you know, terminology here. But it is quite literally just like think about anything where you might be able to improve your quality of life, because that's a big part of, you know, finance and and getting more on top of your finances. If it's easy to do, you're going to be more likely to do it.
So and and this is like, you know, this can be as easy as something like, you know, there's apps that make it easy to split expenses with friends, you know, or petrol spy, which we've spoken a few times about, which helps you sort of find all the cheap petrol around you. Like just little things like that. Like that's the sort of stuff that's going to make 2023 more manageable for you because it's just small and incidental but can actually make a big difference in the long run.
Yeah, I never fill up the tank without checking the petrol app for in New South Wales, Fuel check is the one you want and it's just creating those new behavioural habits for yourself that you know, I'm a person who checks a petrol price out before I fill up and you know, it does require new ways of thinking, particularly if you're not across all the technology, but you know, it is well worth sort of getting a little bit uncomfortable by, you know, and another one I like now
using is cashback sites like Shopback Cash Rewards. It's an extra step in your life, but one that will make it a lot better if you can get your head around. And I just use I bought like ten something that was $10 and got sort of $0.20 back on a cashback up. But it's just teaching me. It's a learning curve of to how I can get those savings and yeah, but just maybe committing to try one of those new apps or downloading, you know, the petrol price app in your,
in your state is awesome. It's well worth it.
Yeah. And when in doubt talk to Zuma. Talk to someone under the age of 25 because they'll have it all sorted out and no.
Sooner is that.
I think so.
Is that a thing?
Because I like I'm 26. I know I'm right on the edge of being a part of being a millennial. And I think the next generation is gen-z or zoomers. So.
Oh, we're calling that Zuma.
Yeah, yeah, yeah, yeah.
Exactly. So talk to some it turns out under the age 25 because they will have it sorted out. They will.
Cost a young person.
On the side. Scuse me, young fellow. How do you do your finances? Um.
Yeah, the kids, they're pretty savvy. They know what's.
They know what's going on. And like, just as a final point around this off, this also extends to things like concessions and rebates, which which we talked about in the past. But there are many of them out there, and especially with the energy price sort of debacle that's going on, it looks like there will be more rebates and concessions available for people next year. So definitely keep on top of that. And I believe even in Victoria they have reintroducing the $250 energy rebate for next year
as well. So that's something that Victorians look out for.
And so finally, just number five to say that this is a really good time to rest and reflect and think about your goals and reset your thinking. You know, about many things, but including money. So having some sort of idea of what you want the New Year to look for for you, or it could even be as simple as sort of how do I want to feel about money in the new year or how do I
currently feel at the end of this year? Probably spend a bit too much on Christmas or but just being aware of what sort of relationship you you have with money. Because I think, you know, going into 2023 is going to be a more difficult year for people financially. I think that's fair to say across the board. So having a little moment to to rest and reflect whether you actually want to set a New Year's resolution, I'm not actually not going to set a money related use resolution.
I actually do them by financial year because I love to have two New Year's every year and it.
Seems more appropriate to think.
About money via financial years.
But that's. Suggesting to do this just.
Like.
Your parody of yourself. Just.
But I do. But these sort of turning points in the calendar year, I do love to break up time into sort of nice, easily measurable things. And I think there is a new year effect where you can sort of surf it for a little while. Maybe it doesn't last forever, but at least sort of saying, I want to have a new relationship with money. I want to feel better about money in the new Year. What's one of the one tips I heard on the podcast that I will commit to in 2023?
Yeah, and I think this year a lot of people were shocked and were quite surprised by the cost of living crunch. Obviously war in Ukraine and stuff that sort of came out of nowhere and people were sort of a bit unprepared. But I think now that we're in this environment that we've been in for the past nine or so months, it makes it a little bit easier to sort of prepare for it and think about it.
And I think that's what is it's a good time to do over this sort of sort of end of year break, obviously, take some time off, have a great time. You know, enjoy your time with your loved ones. Don't worry too much about money because that's what Christmas is for. But then, you know, it is also a great time to sort of think about, you know, get yourself prepared for energy bill rises, interest rate rises, all those sort of terrible things that we're not going to look forward
to at all when they come through next year. But the more sort of steeled you are for the the better it will be rather than this year where it sort of came out of nowhere like a freight train.
Yeah. And I think what's kind of nice about it is we're all in the same boat. It's actually yeah, it is across the board, these pressures. We're all going to be going into 2023 feeling a little bit. A little bit. I'm a little bit nervous about when my mortgage interest rate rolls off. Yeah. So just to feel like you're not alone in it. And it is, it's something that we are all going to have to pay a little bit more attention to in the new year. And yeah, I agree. Everyone have a have a great
break over summer. Hopefully you can get some time off and we'll be back in 2023 to help everyone with more financial tips and strategies so you won't be alone will be will be freaking out right next to you.
Exactly. And for our final listener question of the year, this one's from Zac, and it is for Jess. So I'm going to bow out of this one. But I'll, I'll, I'll, I'll posit, which is about solar panels. So Zach wants to know how you would invest evaluate solar panels as
an investment. He thinks that $1,000 a year annual savings on your electricity bill on an on a $9,000 investment is a pretty good return and might be a better return than anything else you could invest in at the moment, such as equities or cash or anything along those lines. He wants to know Cassandra, He just has done the research from this. What's the cash? You know, what's the what's the bad thing here? Like, does this solar panels a good investment to make money on or not?
Yeah, well, if you are in the fortunate position of sort of having nine to 10 to $11000 sitting around, this is really something for people to think about over summer. As you're switching on your air conditioning, you have to think about, you know, what sort of dollar return will you get on your money. So you've got to have that outlay. You're going to save a certain amount on your electricity bill because you know, you're getting feed in
tariffs by putting money back into the grid. And you're also, you know, getting free energy from the sun when you use it. So I did do the sums on this recently. If you Google my name just so on and solar panels, you'll you'll find that. But it is saving money is great. Not spending money is a great investment in a way because if you compare that so you've dollar you know you get your you spend your $9,000, maybe you get $1,000 every year in savings on your bill, you know,
and about 10 to 11% return. That's true. Maybe you think I'm going to go invest that dollar in the share market and then you'll get a percentage return. It's incredibly volatile and you have to pay tax on the earnings. So that's something to keep in mind. So and then maybe you could have the money sitting in the offset account. That is another way of just saving money because you're not going to pay as much interest on your loan
because you've got the extra dollar sitting there. So that's also a great strategy, but yet finding a way where it's just going to cut your costs out of pocket in an ongoing sense. That could be a great thing for a lot of people to do. If the caveat being if you've got the $10,000 or so that's going
to cost you to install the solar panels. So yeah, I think the tax it's the tax thing that really when you comparing it with alternative uses of your money and even putting money in a 4%, you know, savings account, you're going to pay tax on any earnings that you get on that. And particularly for high income earners, if you're at a higher marginal rate that starts to get you know, you get a lesser return because you're paying losing more of that on tax. So, yeah, there's nothing
like a quick, you know, saving an expense. Cutting an expense is another way of investing money if it does make sense. And I think there's that is something definitely worth thinking about. And I don't think you're missing anything there that. That could just be a really good saving if people have have that sort of disposable cash around.
Yeah, And it's I think it's also worth thinking about, you know, how long are you going to be in the place that you going to put the panels on? You know, I would love to have solar panels on my apartment despite the fact that I'd need to get the approval of the other 13 people that live in the block. But, you know, I'm probably only going to be there for maybe another five ish or more years sort of thing. So like, therefore, it's not worth it. So I think there's there's a lot of things to
take into account. But, you know, yeah, I'd do it if I could.
Yeah. Solar panel advocates do say that if you do install them, it will increase, it will increase the sale price of your home. So I'm not sure if that.
Is true or not that that.
Might be a bit of a line, but yeah, definitely worth investigating.
And lastly, a budget tip. Just bring us bring us into the end of the year. Sleigh bells ringing, carols, caroling. Well, what is it? What's your what's your festive budget tip?
Well, maybe, you know, you're at your Christmas party. You've had a wonderful time. You should definitely not drive yourself home. And I want everyone to get home safely this Christmas. One of my tips is to mix up your ride share app. So I feel like Uber has become like Google versus I'm going to Uber, you know, I'm going to Google something and you've you've forgotten that there's actually competitors to Uber. So I actually use Didi for the first time in the last couple of months. And there's
also Ola and Lyft l y left. You know, they're not in every single area of Australia, but it's well worth having a Google. And just it's another one of those habitual things, you know, you think, I've got to get myself home, I'll just get an Uber. Remember that there are competitors and if you Google Didi and $20 voucher or even just a voucher, I guarantee you will get to a website where you can get at least $20 off your first drive, which might get you home
from your Christmas party this year. So yeah, don't forget to shop around on absolutely everything, including Rideshares.
And here's my supplementary budget tip, which is don't forget about taxis. I go to taxi the other day because sometimes you go into you go going to Uber or your Didi or whatever, and it's surging and it's like, you know, $80 to get you home or something ridiculous. But you can stand on the street and hail a cab. That's still something you can do in like the middle of the city or something, you know, similar to that. And it's usually cheaper. And they can't surge price.
They do night time.
So they do they do that. But like, it'll be like a flat thing. And, you know, often they're pretty, pretty good experience. But, you know, there is the caveat that the taxis can sometimes be a little bit dodgy. But, you know, we want we want, you know, domain domain not.
To be just place. It is. It is. It is. I think this is.
A good time to call it taxi. This is the end of the episode.
It I'm hailing the end of the episode.
The Christmas party is over. I hope everyone does have a great break. And as as we say, look out for our summer series of our greatest hits. Still hitting your podcast players while we're on hiatus.
Yes. And we'll be back in the first week of February. Hopefully we'll have some juicy new tips. Well, no, not hopefully we will have some juicy new tips and there'll be all sorts of things going on that we'll be able to talk about for for the new year. So I hope everyone has a lovely break and we'll see you next year.
See you next year.
This episode of It All Adds Up was produced by Julia Carl KASELL. The information discussed is general in nature and does not take into account your personal financial situation, goals or objectives. You should always do your own research well, get professional advice before making any major financial decisions. If you like today's episode, hit follow a new podcast app. Leave a review and recommend it to all your friends.
You can also submit your listener questions in text or audio form, and it all adds up at 9:00 pm today. Thanks for listening.