Top Tips To Save Aussies Up To $17,400 a year
Thursday March 31, 2011
Australia's leading mortgage broker, Aussie Home Loans, has revealed five simple strategies which could save Australians up to $17,400 a year.
As we show by this example, the saving could cut a $400,000 mortgage (at 7.80%p.a.) by around $266,530 in interest payments or slash 19 years off the life of a 30 year loan.
Aussie's Founder and Executive Chairman, Mr John Symond, said: "By undertaking just a few simple steps, Australians could save money for their first home, investment to build long term wealth or cut years off their mortgage."
"Once the New Year resolutions become a fading memory and everyone gets back into the routine of everyday life, old habits and temptations start to creep in. Our steps could be applied easily and simply with a few phone calls, spending some time online or in a couple of appointments", he added.
"Our research shows that borrowers who come to Aussie could save up to 0.75 per cent on their mortgage rate, which on a $400,000. mortgage rate at 7.8% p.a. represents a saving of close to $3,000 per year or around $95,000 over the life of the 30 year mortgage", added Mr Symond.
- The second step is to establish a few financial goals that are realistic and could be managed throughout the entire year. This could be achieved by regularly transferring a proportion of each pay packet to a separate high interest savings account or applied to extra mortgage repayments.
"By moving $100 a week from a basic saving account (around 0.5% interest) and paying it off the mortgage (assuming a $400,000 mortgage at 7.8% p.a.), it may be possible for people to save $141,595.85 or cut 13 years off the life of the 30-year loan.
- The third step is to create a simple budget plan that reveals how much you could earn and how much you could afford to spend on a weekly or monthly basis.
"By adopting a strategy of paying yourself a weekly wage in a separate account, younger people who are prospective first home buyers could build up a deposit and a routine of retaining a proportion of earnings into a savings account before you have time to spend it," he said.
Simple budgets have been shown to easily save people up to $150 a week on incomes of $80,000 a year, which translates to an annual saving of $7,800.
- The fourth step is to simply give up a takeaway coffee or food at the rate of just $3 a day, which could generate up to $1,095 a year in savings.
A budget planner tool on the Aussie website www.aussie.com.au could help people take control of finances quickly and identifies where small changes could make a big difference to savings.
- The fifth step is to finally dump the high rate credit card and go for a basic card without all of the expensive bells and whistles.
There are many low or zero balance transfer deals to whittle away the credit card balance sooner and it is very easy to arrange a new card through a phone call and online application.
"If you are happy with your current card, always try to pay back much more than the minimum monthly repayment. If you want to move, transfer your debt with a low introductory rate with cards like the Aussie Mastercard," he said.
As we show by example, Aussie's low interest credit card - The Aussie Mastercard* is a no nonsense credit card, with 2.99% p.a. on balance transfers and 9.99% p.a. on purchases for the first 12 months. On a balance of $2,000 and a previous rate of 19.9%p.a. - the transfer could mean a saving of up to $338 for the first year, and $132 per year after that.
Mr Symond said: "If you add up the savings from these five steps ($17,433 per annum or $335.25 per week) and paid it off a $400,000 mortgage at 7.8%p.a., it is possible to save up to $266,530 in interest or cut 19 years off the life of the loan."
An Aussie broker will offer guidance, assess eligibility, lodge the application and then support the borrower through the home loan process. Aussie brokers are available 24 hours a day, seven days a week, in all capital cities and regional centres at the request of customers who call Aussie on 13 13 33.
As one of the country's largest non-bank providers of financial services, Aussie has a loan book of over $40 billion. There are now 140 retail stores and 750 brokers across the country ready to help customers get a better deal on their finances.^
For further information please call:
Brooke Stoddart
Aussie
(02) 8297 0381
Tim Allerton
City PR
(02) 8916 4848
*Fees and charges apply.
^Examples provided are a guide only and may not apply to your situation. Calculation assumes the rates will remain constant throughout, but are subject to change. Credit applications subject to approval. Conditions, fees and charges apply.
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