Home loan rates are expected to continue rising as the Reserve Bank of Australia (RBA) monitors the economic risks and opportunities, but households can take advantage of the upswing to fool-proof their finances over the coming year.

Money Transfer Comparison Alon Rajic said taking advantage of high-interest savings and term deposit accounts is a must for saving households.

“While the RBA’s increased interest rates are a detriment to borrowing households, those with cash savings will be able to start earning better interest potentially,” he said.

Some of the big banks and smaller lenders, Mr Rajic said, are already offering term deposit rates of over 2.25% while others are still providing regular savings account with relatively higher interest.

Mr Rajic said this is crucial, given that many Australian households have not been able to save money in 2022 and are just living to make ends meet.

“Although the road to economic recovery has been relatively strong in Australia this year, with household spending increasing by 7.6% from January to April, major Australian banks are already starting to see a slowdown in credit and debit spending.”

Mr Rajic said using term deposits and high-interest savings accounts is just one of the useful ways to help save money as inflation and rate hikes continue. Other ways include the following:

  1. Balance transfers and consolidate debts

Mr Rajic said many major banks are offering balance transfers with zero interest introductory periods — this is an immediate way for many to take pressure off their credit card debt.

Debt consolidation is also suggested for borrowers who may have lost control of debts across multiple credit lines.

“A consolidation loan allows you to mentally keep track of your finances better with just one simple consolidated monthly payment to take care of, and comes with the added benefit of fees on a single loan product rather than multiple credit card or loan fees,” Mr Rajic said.

  1. Cancel unused subscriptions

Mr Rajic suggested going over smartphone apps, media subscriptions, streaming services or technology subscriptions and determining which ones are rarely used.

“Review your bank statements for any unusual debits. A little hack is to go into settings of your smartphone and check the subscriptions section to see if you are paying for any apps that you don’t need,” he said.

  1. Review plans and insurance premiums

It is also crucial for households to shop around and look for other providers for energy plans, phone subscription, and personal insurance policies that might be offering a better deal.

“You can even use this as leverage to ask your existing provider if they can do a better deal. It costs nothing to do the same with your phone contract close just before it expires, as well as your car, home, and health insurances,” he said.

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