Spend Less, Save More - Budget Savings Tips

March 2023 in Money Matters

With an ongoing focus on interest rates, now could be the perfect time to make some clever and practical changes to your finances and learn how to prepare for any further fluctuations with our helpful tips.

Assess your budget

Now is an ideal time to look at your finances and take stock of your expenses.

Creating a written copy of your spending habits to keep track of and highlight any behaviours can be a great way to note any negative patterns. Assess your current weekly or monthly costs and note the areas you can limit spending.

Options to consider may include limiting weekly takeaways in favour of cooking at home or forgoing an international holiday for a domestic staycation.

Manage your debts

Getting on top of existing debts can go a long way to helping you manage your home loan.

Your financial advisor could help you review and consolidate debts such as personal loans, car loans, credit cards, or bills, into your home loan or a separate personal loan, which could save you money. This method translates to one repayment per month, reducing interest rates.

Home loan interest rates are generally lower than other account interest rates, so by consolidating debts into one repayment, you could immediately begin to save.

We recommend always seeking advice from a financial advisor before making any decisions.

Ask for a lower rate

If your home loan has been with the same lender for several years, it may be time to shop around for a new rate.

Lenders tend to advertise lower, more desirable rates in the hopes of attracting new customers. If your bank is offering a similar deal, speak to them about changing to the advertised rate. In case they turn you away, be ready to head online and compare other banks and lenders.

Before choosing a new deal, read through any fees or costs that may be associated with the account. Common fees include one off and ongoing fees, application fees, monthly fees, exit fees, and annual fees. Before you commit, always seek independent legal and financial advice on your options, rights, and liabilities.

Whether or not you choose to switch to a new home loan, taking the time to understand the hidden fees can be a simple way to prevent stress in the long run.

Review your interest rate

Home loans are available in three options: variable, fixed rate, and split loans.

Fixed rate terms are most commonly offered for periods of 1-5 years, whereas variable rates are subject to the current interest rate. Split loans allow for a percentage of your mortgage to be fixed while the component is subject to a variable interest rate with an offset account.

Review with your financial advisor to discuss whether your current home loan is still your best option.

Use your offset account

All variable home loans feature an offset account, and it’s an essential tool for lowering your interest payments.

Use your offset account as a regular transaction and savings account. Having money in your offset account reduces the interest you will pay on your loan. Any funds in your account will offset your home loan balance and reduce the interest you pay. Ensure your monthly salary is paid directly into your offset account.

Increase your repayments

Increasing your repayments can save you money long term. Speak to your bank about making repayments every two weeks instead of once a month.

Accidentally, you will end up making an extra two repayments, as there are 26 fortnights in a year, but only 12 months. In this way, you could pay off your mortgage years in advance.

Ask your bank for assistance

It is in your bank’s best interest that you finish paying your mortgage, so if you’re struggling financially and cannot meet your monthly repayments, tell your lender early.

Most banks offer payment assistance plans and are willing to work with their customers on repayment options.

Interest rate hikes can be stressful, but by taking the time to discuss your options with your lender, assessing your expenses, analysing your debts, and considering alternative banking solutions you can take control of your finances for clarity and financial stability well into the future.



This article is made available by DFC (Woodstock) Pty Ltd (DFC) for general information purposes only. By viewing this article, you understand, acknowledge and agree that:

  • this article contains only general information and DFC provides no guarantee that the information in this article is accurate, current or complete;
  • this article does not take into account any individual’s particular circumstances;
  • this article does not constitute any legal, tax (including stamp duty), financial or investment advice and is not to be relied upon as, nor to be used as a substitute for, legal, tax (including stamp duty), financial or investment advice.

You alone are solely responsible for determining whether any investment, asset or strategy is appropriate or suitable for you based on your investment objectives and personal and financial situation. You should consult a suitably qualified professional about your specific legal, tax (including stamp duty), financial or investment situation before purchasing off-the-plan property.

To the extent permitted by law, DFC accepts no responsibility or liability for any loss which may be suffered or incurred by any person who acts, or refrains from acting, on or as a result of any information contained in this article.