Welcome to the first edition of SmartChoice Money insights. SmartChoice Money provides finance solutions to enable individuals & business owners to make smarter money choices to achieve their goals and work towards financial freedom. Importantly we offer a personalised service based on working face to face (enabled by Zoom on occasion given the current pandemic environment) with our clients for the long term and our referral partners.
We will be discussing & providing updates on a range of topics regarding the lender, property market updates & achievements that benefit and impact you as a borrower and business owner.
At the last meeting of the Reserve Bank of Australia (RBA) on 7 July 2021 the Board held the cash rate target at the historic low of 10 basis points. The Board has committed to continue the purchasing of government bonds to support low funding costs as the economy transitions from the recovery to the expansion phase.
The 2024 target impacts the current fixed rates on offer, with some bank economists announcing their prediction the RBA will increase earlier, with CBA predicting as early as 2022 whilst Westpac slightly later in 2023. In line with the RBA’s commitments there has been a gradual tightening in fixed rates since late 2020.
There are many considerations impacting the RBA actions and economist predictions and notwithstanding the current lockdown of Australia’s two largest cities Sydney and Melbourne and imposed national travel restrictions will hinder the current rapid improvement in the economy.
The best interest rate in the world is not important, if the product does not suit your current needs. For example, a 100% fixed loan without offset features where you are likely to have some significant spare cash in the next year & lose the benefits to reduce your overall debt.
SmartChoice Money look forward to bringing you insights to start conversations & keep you updated on the dynamic finance environment.