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  • Writer's pictureVictoria Wallis-Smith

Another rate rise! ... What can you do?

With yet another rate rise, it’s not surprising that many, many people are struggling with their day-to-day finances. It's a double whammy coming on top of higher costs for many household expenses.


So, let’s talk about the practical things you can do to make ends meet – stretching a fixed income across ever increasing costs.

Make ends meet. Financial struggles. Cost of living. Money coach Adelaide.

The good news is that for many people there are some simple adjustments that can make a big difference, and most importantly, there is help out there for those that seek it.


Tip #1: Be proactive

The first thing I want you to do is be pro-active – this is not a time to stick your head in the sand and hope that things will work out for the best.


Know your numbers

You need to allocate a decent block of time to sit down and look at your finances in detail. If you have a partner, try making it a date night – a bottle of wine might be in order – so both of you can get on the same page.


On your money date you’re going to need printed copies of your bank and credit card statements, and a couple of highlighter pens. Three months of statements is usually enough to give you a good understanding of where your money is going.


As you go through your statements look for two types of expenses – the first one to focus on is the discretionary spending. These are the things that we like to have, but they’re really not essential – think take-away meals, subscriptions and memberships. Highlight these in one colour.


Next, look for all the big-ticket items – housing costs, groceries, transport and utility bills – highlight these in another colour.


Find some savings

Now it’s time to find some savings – and remember, this is about taking steps to alleviate financial stress so take a hard approach to buy yourself some breathing space over the coming months.


For the discretionary items, the secret is to find ways to spend less as your start point – rather than cutting everything completely. For example, you could have more social gatherings at home, asking friends to bring a plate – that’s less eating out and less takeaway.


You could cut back on a few subscriptions that you don’t really need and use free streaming services like ABC iView and resources at your local library.


For the big-ticket items, it’s all about getting a better deal – and the best place to start is with the biggest cost, which for many people will be home loan repayments.


The first step should always be to call your bank and ask for a rate review. We’re finding many people can cut half a percent or more from their home loan rate just by asking.

A recent client called their bank and had their rate reduced from 5.5% to 5.12% – that's a saving of 0.38%, so making that call can be a valuable exercise.

It’s also a good idea to contact a mortgage broker to see what else is out there.


Once you’ve done this with your home loan, you can apply the same principle with your power bills and other utilities.


Tip #2: Be positive

As you go through this process it’s important to be positive about the changes you’re making.


During Covid, many people embraced the benefits of a simpler life – partly through necessity of course. But we also learnt to appreciate what’s important to us… something we too easily forget when we get busy.


The great news is that spending time with loved ones – whether going for a walk with friends, or sharing a home cooked meal – doesn’t come with a big price tag.


Tip #3: Be open to help

If you are really struggling, help is available:

  1. For anyone who is unable to pay their bills and put food on the table, a Financial Counsellor is a free service that can help those most in need.

  2. If you have a Financial Planner or Accountant, you should certainly speak to them. While their focus doesn’t tend to be on day-to-day spending, they have experience and access to resources that can help you.

  3. For everyone else, a money coach can provide support to help you through this process.

Need help?

If you’re feeling stressed or overwhelmed about money and you’d like to have a chat with a money coach, get in touch using the link below. At Nutshell Money, we’re here to help.


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