For a ‘record’ 13 months in a row now, the RBA has decided to keep interest rates on hold at a cash rate of 2.5%.
“Ho – hum” / “ big woop”…… the monthly meeting of the RBA has become so predictable now, most no longer pay any attention to the announcement. And there-in lies the danger.
We are all in danger of developing a dose of SUNNY DAYS DISEASE.
What may you ask is SUNNY DAYS DISEASE ? – thinking that every day the sun is going to shine, that storms are a thing of the past and we don’t need to worry about the future, ‘cause it’s all gonna be smooth sailing!’
Those under 35 could be excused for thinking this way ( as they’ve never seen a recession, let alone a depression ) and yet, this easy going attitude isn’t exclusivey their domain.
We all, unfortunately, have short memories; and generally, we don’t do things until we HAVE to.
Many don’t think about retirement until they are nearly there ( and then they learn it is too late ).
Now is a great time to review and prepare.
Did you know that there are lenders ( four in fact ) offering one-year fixed rate with a ‘3’ in front. A ‘3’ in front…………………??????
Now, I’m not proposing fixing, but most of us have never seen interest rates this low, and we are in danger of letting the biggest opportunity of our lives slip away.
Now is a great time to consolidate debt – yes – check your credit cards, they are still closer to 20% / personal loans ( car loans ) taken out a couple of years ago are still sitting on 10%+. A plan where we consolidate debt at less than 5% and keep payments at the higher amounts can see thousands repaid in record time. Something the banks don’t want you to do.
In a recent survey, we asked a group of clients if they would consider borrowing $10MILLION, 9 out of 10 said “NO!”
We then asked the same group a slightly different question “ If there was no interest charged on the borrowings ( and you could take as long as you like to repay the moneys ) would you borrow $10MILLION ?”
This time, 9 out of 10 said “YES !!!!”
It’s not what we borrow, so much as what we have to pay back ( and this is determined by two things – time and the rate of interest ).
Now is the best time, with interest rates at record lows and whilst we still have time on our side, to put our house in order, pay down debt and increase equity.
Now is the best time, to reduce BAD debt, maybe take on GOOD debt – and build equity.
Now is the best time to review our plans.
What do you plan to do?