- July 27, 2016
- Posted by: admin
- Category: Home loan product, Interest rate
We asked you… “When it comes to your finances, what worries you the most?”
We recently surveyed our client base and asked them to nominate their top 3 areas of financial worry.
Why did we do this?
As your finance specialist it is important for us to know what concerns our clients the most. Your feedback provides us with valuable information on how we can assist you most effectively towards a more secure financial future.
Below is an overview of the survey results and the top ten nominated finance worries…
How does this compare with your own situation?
Q. When it comes to your finances, what worries you the
1. Having enough money for retirement- 66%
2. Being able to maintain the lifestyle I enjoy – 42%
3. Cost of living/household expenses – 31%
4. Will our children ever be able to aff ord to buy a home? – 27%
5. Level of debt (credit cards/loans etc) – 21%
6. Too little savings for emergencies – 19%
7. Changing financial markets and home loan products – 15%
8. Lack of a financial plan -14%
9. Being able to cover the costs of educating/supporting my
children – 12%
10. Struggling to pay the mortgage or rent – 11%
It’s not surprising that retirement funds and future lifestyle were top of mind for most of us.
Q. Tell us about your household:
• Single income household – 42%
• Double income household – 50%
• Children living at home – 36%
• No children living at home – 35%
• Have a mortgage – 65%
• Have an investment property – 48%
• Renting – 9%
What do these statistics tell us?
Results were ballpark across demographics. This would indicate worries are similar regardless of income, dependants, home ownership or living arrangements.It was great to see 48% of respondents have an investment property! This is a great start to any retirement strategy.
Lastly, we asked our clients:
What worries you the most financially?
We have a library of articles on various finance areas. What is YOUR current worry?
Contact us and we will be pleased to help.
Q. If and when interest rates increase what increase do you think you can manage without mortgage stress?
• Could manage 2% – 33%
• Could manage 1.5% – 9%
• Could manage 1% – 26%
• Could manage 0.5% – 15%
• Could manage 0.25% – 13%
• Could NOT manage any increase – 3%
Obviously the actual amount of any increase will be dependent on the size of your mortgage and the change in interest rate. As a guide an average $430,000 mortgage at 5.68% would equate to an extra $68.48 per month at a rate increase of 0.25%
There were 33% of respondents who indicated they could manage up to a 2% increase. That’s a good sign! This is the ‘buffer’ most lenders take into account when assessing your ability to meet loan repayments.
Worryingly 3% of respondents said they could not manage ANY increase and 13% could only manage 0.25%.
If you feel this could be you TALK TO US TODAY.
We can assess your current situation and see if we can assist you with strategies to add breathing space to your repayments BEFORE any future rate hike occurs.
Do you know your interest rate?
If you don’t or if you haven’t reviewed your finances in the past 18 months you could be missing out on a better rate. We encourage you to contact us to book a finance review!
We will be providing some great articles in this and future issues with tips on how to manage many of these areas of concern. Make sure you look out for them each issue!