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Catherine's Chat

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AMP Federal budget 2016

Friday, May 06, 2016

 2016-17 Federal Budget- Client Briefing     


4th May 2016                                                                    


Federal Treasurer Scott Morrison put forward a number of proposed changes, mainly around contributions to superannuation and taxation, in his budget speech last night. Here’s a brief roundup of what the proposals could mean for you—whether you’re starting out in your career, taking care of family, on the cusp of retirement or enjoying life after work. Remember, proposals are not set in stone and could change as legislation passes through parliament.




1. Lifetime cap for non-concessional superannuation contributions

Proposed effective date: 7.30pm (AEST) 3 May 2016


Currently, the non-concessional contributions cap is $180,000 per person, per financial year. If you are under age 65 at any time in the financial year, you can make a non-concessional contribution of up to $540,000 under the bring-forward provisions. The government proposes to replace the current contributions cap with a $500,000-lifetime non-concessional contributions cap. This lifetime cap is proposed to commence at 7.30pm (AEST) on 3 May 2016. The cap will be indexed to average weekly ordinary time earnings (AWOTE). The lifetime cap will take into account all non-concessional contributions made on or after 1 July 2007. Contributions made between 1 July 2007 and 3 May 2016 will be counted towards this lifetime cap. However, contributions made before the commencement of this measure, that is 7.30pm (AEST) on 3 May 2016, will not result in an excess. Excess contributions made after commencement will need to be removed or be subject to penalty tax.


2. Reduction of the concessional contributions cap

Proposed effective date: 1 July 2017


Currently, the standard concessional contribution (CC) cap is $30,000 per financial year. A higher temporary concessional contributions cap of $35,000 (unindexed) applies if you are aged 49 years or over on 30 June of the previous financial year. The government is proposing to reduce the annual cap on concessional superannuation contributions to $25,000 for everyone, irrespective of their age.


3. Reduction to Division 293 tax threshold

Proposed effective date: 1 July 2017


From 1 July 2017, the government has proposed to lower the Division 293 threshold (the point at which high-income earners pay an additional 15 per cent tax on contributions) from $300,000 to $250,000.


4. Allowing catch up concessional contributions

Proposed effective date: 1 July 2017


Currently, the concessional contributions cap is applied on a ‘use it or lose it’ basis. That is, the unused amount of the concessional cap cannot be carried forward. From 1 July 2017, the government will allow eligible individuals to make additional concessional contributions where they have not reached their concessional contributions cap in previous years. This option will only be available to those individuals with a superannuation balance less than $500,000. It is proposed that the unused amounts will be carried forward on a rolling basis for a period of five consecutive years with only unused amounts that accrue after 1 July 2017 being eligible. The proposed measure will also apply to members of defined benefit schemes.


5. Removal of the work test to contribute to superannuation

Proposed effective date: 1 July 2017


Currently, individuals aged 65 to 75 who want to make voluntary superannuation contributions need to meet the work test. People aged 70 or over are also currently unable to receive contributions from their spouses. The government will remove these restrictions for all individuals aged less than 75, from 1 July 2017.


6. Making it easier to claim tax deductions for personal super contributions

Proposed effective date: 1 July 2017


Currently, if you are engaged in employment activities during a financial year, a deduction for personal superannuation contributions can only be claimed where the ‘less than 10% rule’ is satisfied. This rule broadly requires that the income attributable to employment activities does not exceed 10% of income from all sources. 2016–17 Federal Budget – client briefing 4 May 2016 The government is proposing to abolish this test, allowing all individuals up to age 75 to claim an income tax deduction for personal superannuation contributions. If legislated, this will effectively allow all individuals, regardless of their employment circumstances, to make concessional superannuation contributions up to the concessional cap. Observations: –– This measure assists those whose employer may not provide the ability to make salary sacrifice contributions to super. It will also assist those who are partially self-employed and partially wage and salary earners.


7. Introducing the Low-Income Super Tax Offset (LISTO)

Proposed effective date: 1 July 2017


From 1 July 2012, individuals with an income of up to $37,000 automatically received a government contribution of up to $500 paid directly into their super. However, this Low Income Superannuation Contribution (LISC) will not be available in respect of concessional contributions made after 1 July 2017. From 1 July 2017, the government is proposing to introduce a replacement – the Low Income Superannuation Tax Offset (LISTO). The LISTO will provide a non-refundable tax offset to superannuation funds, based on the tax paid on concessional contributions made on behalf of low-income earners, up to an annual cap of $500. The LISTO will apply to members with adjusted taxable income up to $37,000 who have had a concessional contribution made on their behalf.


8. Making spouse contributions more attractive

Proposed effective date: 1 July 2017


Currently, if you make contributions into your spouse’s account you are entitled to a tax offset of up to $540 if certain requirements are met. One of the requirements to qualify for the maximum offset is that the receiving spouse’s assessable income, reportable employer superannuation contributions, and reportable fringe benefits in the financial year must be less than $10,800. To be eligible to receive the contribution, the receiving spouse must currently be: –– under age 65, or –– aged between 65 and 70 and has met the work test for the financial year in which the contribution is made. The government proposes to: –– remove the work test restrictions for all individuals aged up to 75, and –– increase access to the spouse superannuation tax offset by raising the lower income threshold for the receiving spouse to $37,000 (cutting out at $40,000).


9. Changes to the taxation of Transition to Retirement (TTR) income streams

Proposed effective date: 1 July 2017


The internal earnings within a superannuation account on the amount used to purchase a pension are currently tax-free. This will no longer apply to transition to retirement income streams from 1 July 2017 should the proposal go ahead. This means that earnings on fund assets supporting a transition to retirement income stream after this date would be subject to the same maximum 15 per cent tax rate applicable to an accumulation fund.


10. The introduction of a $1.6 million superannuation transfer balance cap

Proposed effective date: 1 July 2017


From 1 July 2017, the government is proposing to introduce a $1.6 million transfer balance cap. This cap will limit the total amount of accumulated superannuation benefits that an individual will be able to transfer into the retirement income phase. Subsequent earnings on pension balances will not form part of this cap. If you have superannuation amounts in excess of $1.6 million, you will be able to maintain this excess amount in a superannuation accumulation account (where earnings will be taxed at the concessional rate of 15 per cent). A tax on amounts that are transferred in excess of the $1.6 million cap (including earnings on these excess transferred amounts) will be applied, similar to the tax treatment that currently applies to excess non-concessional contributions. Fund members who are already in the retirement income phase with balances above $1.6 million will be required to reduce their retirement balance to $1.6 million by 1 July 2017 should the proposal go ahead. These excess balance amounts may be converted to a superannuation accumulation account.


Taxation – general


11. Changes to marginal tax rates

As speculated, a tax cut has been proposed at the current $80,000 taxable income threshold. As a result, marginal tax rates for resident taxpayers are proposed to change as follows:

                 2015–16                                                               2016–17

Income ($)              Marginal tax rate (%)                        Income ($)           Marginal tax rate(%)


 0-18,200                                           0                           0-18,200                                      0

18,201-37,000                                  19                           18,201-37,000                             19

37,001-80,000                                32.5                          37,001-87,000                           32.5       

80,001-180,000                                37                           87,001-180,000                            37

>180,000                                         47                           >180,000                                    47


Notes: Medicare levy may also apply, 47% tax rate includes Temporary Budget Repair Levy (TBRL, additional 2%). The TBRL is due to expire from 30 June 2017 and has not been extended in this budget. 


–– The Low Income Tax Offset (LITO) remains unchanged which gives resident taxpayers an effective tax-free threshold of $20,542 in 2016–17.

–– Indicative tax cuts: If you earn $87,000 or more per year, you would get a maximum tax cut of $315 under this measure. If you earned less than $80,000 there will be no change to your tax      calculation.


Taxation – small business


12. Increase in small business entity turnover thresholds

Proposed effective date: 1 July 2016


Starting from 1 July 2016, the government proposes to increase the small business annual aggregated turnover threshold from $2 million to $10 million for certain small business concessions. From 1 July 2016 these small business concessions include:

–– the lowering of the small business corporate tax rate (see below)

–– for all businesses with annual aggregated turnover of less than $10 million simplified asset depreciation rules, including immediate tax deductibility for asset purchases costing less than $20,000 until 30 June 2017, and

–– other tax concessions such as the extension of the FBT exemption for work-related portable electronic devices and the immediate deduction of professional expenses.


–– The current $2 million turnover threshold, or alternative $6 million net asset value test, will be retained for access to the small business Capital Gains Tax concessions.


13. Lowering the company tax rate to 25 per cent

Proposed effective date: 1 July 2016


The government proposes to reduce the company tax rate to 25 per cent by 2026–27. Initially, the tax rate for companies with an annual aggregated turnover of less than $10 million will be reduced to 27.5 per cent from 1 July 2016.


14. Unincorporated small business tax discount

Proposed effective date: 1 July 2016


For small businesses, that are not companies, the government proposes to extend the unincorporated small business tax discount. From 2016–17, the discount will be available to business with aggregated annual turnover of less than $5 million, up from the current threshold of $2 million. The discount on tax payable on business income will be increased to 8 per cent, up from the current 5 per cent, but the maximum discount available will remain at $1,000 per annum. Over the next decade it is proposed to further expand the discount in phases to a final discount of 16 per cent, with the existing $1,000 maximum discount per individual for each income year to remain.


Families and social security


15. Deferral of reforms to childcare payments

Proposed effective date: 1 July 2018


As part of the May 2015 Federal Budget it was proposed that a new single Child Care Subsidy (CCS) would replace the Child Care Benefit, the Child Care Rebate and the Jobs, Education and Training Child Care Fee Assistance from 1 July 2017. This measure has not yet been legislated and the proposed start date will now be deferred until 1 July 2018.






What you need to know

Any advice in this document is general in nature and is provided by AMP Life Limited ABN 84 079 300 379 (AMP Life). The advice does not take into account your personal objectives, financial situation or needs. Therefore, before acting on this advice, you should consider the appropriateness of this advice having regard to those matters and consider the product disclosure statement before making a decision about the product. AMP Life is part of the AMP group and can be contacted on 131 267. If you decide to purchase or vary a financial product, AMP Life and/or other companies within the AMP group will receive fees and other benefits, which will be a dollar amount or a percentage of either the premium you pay or the value of your investments. You can ask us for more details.

Free GPS Economic Update Seminar 3rd March

Tuesday, February 16, 2016

On Thursday 3rd of March, Wholistic Financial Solutions will be hosting a FREE GPS Economic Update and CARE seminar at The Quality Inn , Dickson. Starting at 6.30pm this is sure to be a fun and informative evening with Special Guess speaker Rob McGregor and Emmanuel Calligeris. Visit our website or simple follow the link below. Look forward to seeing you there.

Stuart Westhoff on Pension Changes

Tuesday, February 16, 2016

Pension changes 1 January 2017 – editorial/newsletter article

Don’t get caught offside when the pension rules change

The commencement of 2017 will see some significant changes to means testing for Social Security pensions (including the Age Pension).

Uncertainty around income can be unsettling for those receiving a pension or considering retirement. That’s why it’s important to understand if and how you might be impacted by the new rules so that you can review your game plan before they change.

What’s changing?

The Government is making two changes to the assets test which will take effect from 1 January 2017.

Pensioners need to be aware of how the changes impact their entitlements. For some, the changes will create a cashflow shortfall and may have a significant impact on standard of living.

1. Increasing the lower assets test threshold

The lower assets test threshold refers to the level of assessable assets that can be owned before pension entitlements are affected. Pension payments are reduced once assets exceed this level.

Encouragingly, it is estimated this change will result in around 50,000 part pensioners qualifying for a full pension. Those already on a full pension will be unaffected by this change.

Thresholds differ, depending on your relationship and home-ownership status. Here’s how the new levels compare to the current ones:


Current lower asset threshold

Lower asset threshold from 1 Jan 2017

Single homeowner



Single non-homeowner



Couple homeowner



Couple non-homeowner



2. Increasing the assets test taper rate

The taper rate is the rate at which pension entitlements reduce where assessable assets exceed the lower threshold. The rate will be increased from $1.50 to $3 per fortnight for every $1,000 in assessable assets above the asset threshold.

As a result of this increase the pension the upper threshold is effectively lowered, meaning the pension cuts off at a lower level of assets. It is estimated that approximately 91,000 part pensioners will no longer qualify for the pension and a further 235,000 will have their part pension reduced.

Once again, the upper threshold will depend on an individual’s relationship status, home-ownership status and whether they are asset tested or income tested.


Current upper assets threshold

 Estimated upper assets threshold from 1 January 2017            

Single homeowner



Single non-homeowner



Couple homeowner



Couple non-homeowner



Pensioners who lose entitlements as a result of the changes will cease to be eligible for the Pensioner Concession Card (PCC). They will, however, automatically qualify for the Commonwealth Seniors Health Card (CSHC) or if less than pension age, the Health Care Card (HCC).

What about income tested pensioners?

While the changes are more directly relevant for assets tested pensioners, those who have their pension entitlement determined under the income test may not be unaffected. The changes could mean that certain pensioners become asset tested and this could lead to a loss of some or all of their entitlements.

What can be done?

Thankfully, there are a number of potential strategies that could be put in play to reduce the impact of the new rules.

Strategies which reduce an individual’s or couple’s assessable assets, like gifting or expenditure on the main residence, may potentially help. As every situation is different, it’s important that your game plan is both appropriate and sustainable for your circumstances.

Don’t get caught offside when the rules change, talk to your financial adviser about your game plan.

Are all Fund Expenses Tax Deductible?

Friday, October 25, 2013

Have you recently seen advertising inviting you to attend a conference or seminar to educate you about self-managed superannuation funds (SMSFs)? Your SMSF pays for the privilege of attending the 'conference' in Australia or overseas and you take a holiday as well, all at the fund’s expense.

You might want to think again and seek advice as to whether this is the type of expense your SMSF should be paying and claiming as a tax deduction.

While it may be possible for your SMSF to get a tax deduction for a range of activities, they must be authorised in the first place by your SMSF’s trust deed.   Also, for any expense of your SMSF to be tax deductible it must be linked to income earning activities of the fund.  No tax deduction is available if the expense is for private or domestic purposes – such as holiday or travel expenses for the trustee which are unrelated to the fund’s income earning activities.  When it comes to expenses that an SMSF trustee incurs for the fund, care needs to be taken so that the expenses relate to the fund's income and not for other purposes which are personal or related to the fund's exempt income (normally its pension income).

Personal expenses may include part or all of the expenses relating to the trustees attending a conference which has both a personal element (such as sightseeing) and an element that relates to the income earning activities of the fund (a SMSF trustee education course).  In cases where the fund pays the personal expenses of the trustees or the expenses are required to be divided between the personal expenses and SMSF income producing expenses there are a number of issues.  The first is that the expenses which relate to personal expenses are not tax deductible for the SMSF but there may be wider implications for purposes of complying with the superannuation laws.

The superannuation law considers if the superannuation fund pays for or reimburses members or their relatives for private expenses then it breaches the rule that the SMSF must operate to solely provide retirement benefits for its members.  These fund activities can also breach the rule which prohibits SMSF members or their relatives using the resources of the fund for private purposes. 

Using the SMSF to pay for private activities in this way exposes the SMSF’s trustees to penalties for breaching the superannuation law.  The fund may be at risk of having the SMSF treated as a non-complying superannuation fund resulting in the SMSF losing its essential tax concessions.  Also, such a breach could result in the SMSF’s trustees being disqualified as trustees.

Unsure of whether fund expenses are tax deductible?

Marketing hype and fantastic offers can often lure SMSF trustees into making decisions that can impact their fund’s compliance. Before your SMSF ends up paying expenses that may not be tax deductible, seek advice from an SMSF specialist.

If you are considering participating in a conference to educate you on SMSFs that also includes a personal element such as an overseas or local holiday, seek guidance on whether your SMSF is allowed to pay for it. Call me for assistance or arrange a time that we can meet to discuss the impact on your SMSF.

 By Catherine Smith

Australian Super Ranked Third in the World

Wednesday, October 16, 2013


An Award Winning SMSF Provider. Take Control Of Your Super Today!

Australia's $1.6 trillion superannuation system has been ranked as the third best in the world, although it emerged with strong marks around integrity, according to a report looking into the retirement income systems of 20 countries.

Australia was beaten by the retirement savings system in the Netherlands and Denmark, and its super system was described as having a ''sound structure, with many good features, but has some areas for improvement''.

According to the Melbourne Mercer Global Pension Index, Australia's improved score - of 77.8 points, up from 75.7 in 2012 - was ''primarily caused by the introduction of the Stronger Super reforms leading to improved governance and stronger regulation''.

The Stronger Super reforms included requiring super funds to offer a low-cost, default fund for disengaged members.

The report - completed by financial services firm Mercer and the Australian Centre for Financial Studies - said Australia could boost its score by requiring that part of the retirement benefit must be taken as an income stream.

It also recommended increasing the labour force participation rate among older workers, boosting the pension age as life expectancy increases, aligning superannuation access age with the pension age, and removing legislative barriers to encourage more effective retirement income products.

Mercer senior partner David Knox said the ageing population meant Australians needed to change their attitudes towards retirement and that businesses needed to develop more flexible workplaces to take advantage of older workers' skills.

The report, funded by the Victorian government, concluded the global shift from defined benefit pension schemes necessitated a focus on provision of retirement income, rather than wealth accumulation.

The UK's super system was ranked ninth while the US came in at 11.

Read more:

New Wealth Drivers: SMSF's and China

Monday, October 14, 2013

By: Jon Giann


There were quite a few comments on my last piece that i thought were worth fleshing out a bit.

If you missed it, the argument in a nut shell is that self-managed super funds (SMSFs) are now sitting on a massive pile of cash (bigger than Westpac). They have a fairly small exposure to residential property, and surveys suggest they’d like to increase it. If they did, and took advantage of rules that allow them to leverage, we could see a huge surge into property.

First of all, thanks to Greg M for picking up on a mistake. I said that SMSFs could leverage against assets. As he correctly points out they can’t. SMSFs are allowed to borrow to invest, though the exact rules have changed a few times in recent years.

My reading is that it works the same for SMSF as it does for you and I, with certain deposit and loan to valuation ratios enforced by the banks. This means that SMSFs can leverage, but only off cash holdings.

I got a bit lazy with the distinction between cash and assets there. But it doesn’t change the numbers at all. SMSFs have more than enough cash to cover the kinds of property exposure they’d reportedly like, so those quick back-of-the-envelope calculations I did still hold water.

But thanks Greg for keeping me on my toes. It’s good to know my readers won’t let me get away with intellectual sloppiness.

Second, Amanda was wondering that if there was a demand for 700,000 properties from SMSFs, who would fill them? As she rightly says, “they have to fill those houses with tenants to see a return on investment… 700,000 or so more tenants need to be found in a very short time…”

The answer to Amanda’s question is exactly the dynamic that is going to drive prices higher.

If SMSF demand suddenly caused an increase in supply of 700,000 homes, then that’s right, there would be a glut of rental properties, and rental and property prices would fall.

But that’s never going to happen.

It’s funny. I write around 1,000 words per article and some people get a fixation on one single point like the 700,000 homes. The reason I mention it is to highlight how much money is in SMSF’s and what potentially is possible.

Here’s the reality…

As I said, we build about 70,000 homes a year at the moment, so unless we really start cranking up production, it would take ten years to build that many homes.

And as Amanda says, SMSFs are going to want to see a return on their investment. So the most likely scenario is that the SMSFs will just go after existing properties that are tenanted already.

That means they’re going to start competing for the existing investment properties already out there. Maybe some will build off the plan, but typically investors favour established dwellings.

But there’s only a limited number of those. So that means that all this extra demand is just going to jack up the price.

Remember it’s 700,000 properties at current price levels. As the price level goes up, SMSFs will need fewer actual homes to get the exposure they want. Some other investors will cash-out or get squeezed out of the market, and at some point, the market will find a new equilibrium.

I don’t know exactly what that end point would look like, but the only guarantee in that scenario is that prices will be a heck of a lot higher.

My mate John Fitzgerald pointed me to some back-of-the-envelope calculations he did. Now John is worth squillions, and has over 5,000 property transactions to his name. When he talks, I listen.

John agrees with the basic maths I’ve got. But he compares the SMSF appetite to the value of sales. He says that in Australia we sell around $190 billion in residential property each year.

With gearing, he reckons 30 percent of SMSFs alone could buy every residential property sold in Australia, for the next three years!

As he says, almost 3,000 SMSFs are being set up every month! In his mind, it’s a total game changer.

He reckons this is one of the factors that helps explain one of the property market puzzles of recent times. We’ve seen prices, particularly in Sydney growing strongly (if we annualised September’s growth we get something close to 30 percent!).

But credit is only growing at 4.7 percent. How can that be? How can we have a boom without credit growth? That’s never happened before.

He reckons the answer is that there are new buyers in the market that we’ve never seen before. One is SMSFs.

The other is the Chinese.

And he reckons it’s taken the market by surprise, because 6 years ago, neither buyer existed.

As he says, “I look at China and you can take my numbers on SMSF and quadruple them and still not come near the capacity there. John McGrath told me that one of his Sydney auctions in September had 16 registered bidders – all Chinese origin and all cash buyers.”

“The top two house sales in Australia this year were for $52m and $33m, both to the Chinese and both in cash.”

I’ve been saying this for a while too. I don’t think most people realise the kind of wealth machine that China has become.

Before the GFC, to make the top 50 wealthiest list in China you needed $6 million. Today, you need $3 billion. These days, they’re creating 25 billionaires per month!

China’s top 20 percent had $1.4 trillion in bank savings last year. John notes that just 13 percent of that would buy every house in Australia, in one year.

Thanks John. That’s some serious food for thought.

(And I think this probably answer’s Tom’s question from the last post, right?)

We’ve got a cyclical upswing combining with a massive paradigm shift in the make up of the market, with the twin giants of China and the SMSFs letting their presence be felt.

It’s going to be HUGE!

And thanks everyone for the comments. I don’t often have time to respond but I do follow them closely, and I’m always impressed and humbled by the intelligence and knowledge that’s on display.

As I said, it definitely keeps me on my toes. I can’t slack off with you lot around!

Property has Historically Low Volatility

Friday, August 02, 2013


Housing prices are fundamentally less volatile than the share market.  This has been clearly demonstrated by the performance of the share market over the few years prior to 2010.  Many investors in the share market and investors in superannuation (who invests it in the share market) saw their investments and retirement funds drop by as much as 40 -50% over a mere few months. 

House prices can go up and down (as the graph below indicates) however they have never fallen by 40- 50% in a few months.  In fact the long term average of Australian property is around 10-11%.




The share market on the other hand has had a long term average (before the GFC) of around 9-10%.  It will be interesting to see whether this measure is still correct in a few years time when the long term effect of the GFC can be measured.

Suffice to say, and as demonstrated by the graph below, the property market is simply less volatile than the share market. A major reason for this is that property in Tangible, real ‘bricks and mortar’ and it fulfils the fundamental human need of a ‘roof over your head’ (see next chapter).



How to Buy Property in Your Super Safely

Friday, May 17, 2013

The ATO recently released a statement about their concern over people investing into property with their super without fully understanding their obligations under the law.

Their concern is based on real life examples where incorrect structures or lending arrangements have been setup by the individuals.

This has resulted in a number of funds becoming non-complying and penalties being issued for the breaches. This problem is caused by trustees trying to implement the complete strategy without getting the appropriate advice and having so many parties involved in the process.

Here is a short list of some common mistakes;

- Incorrect entity name on the front page of the contract

- Purchasing the property directly in super without setting up the Bare Trust arrangement

- Incorrect lending arrangements where the name of the lender is the incorrect entity

- Rental income and Interest expenses coming or going into the wrong bank account

- Using the same Corporate Trustee for both the super and the bare trust to reduce the costs

- Using the property for personal use (including related parties)

- Lack of liquidity within the Self Managed Superannuation Fund

Buying property in super can be a very valuable strategy if it is implemented correctly and it is appropriate for your situation. WFS Canberra has been providing advice on implementing Super and Property strategies for over ten years and has experience in all aspects of buying property in super including;

  • Establishing an SMSF
  • Obtaining loan approval for an SMSF to buy property
  • Establishing a Bare Trust
  • Sourcing Property for an SMSF
  • Ensuring your Investment Strategy is sound and acceptable to the ATO
  • Holding your hand through all aspects of the transaction to ensure it progresses smoothly and avoids all ATO scrutiny.

Independant Professionals Agree with WFS Strategies and Advice

Monday, May 13, 2013

An investment journey begins for Wholistic Financial Solution clients - Glen and Natalie Dickie. These two clients have made it into a 4 page article in the Australian Property Investor Magazine where professionals have agreed with Catherine’s advice and strategies!

Click here to read the full article!

RBA Reduces the Cash Rate to a New Record Low of 2.75%

Wednesday, May 08, 2013

The RBA has again moved into new territory today – with the board deciding to reduce the cash rate by 25 basis points to an all-time low of 2.75%! Depending on how the major lenders choose to pass on these savings – this could result in homeowners paying the lowest rates on their mortgages in recent history – which is going to be welcome news to most!

The RBA – citing low inflation numbers and generally pessimistic market expectations – reduced the cash rate to again attempt to spurn economic activity in wake of a global market which is again experiencing jitters – with the European debt market showing signs of volatility. The actions of the RBA to date have been relatively successful in maintaining a steady level of growth domestically – even if it is a bit less than predicted towards the end of last year.

As a result of this announcement it is important to take the time to compare what you are currently paying on your home loan with the best deals available in the market – as you could be paying thousands of dollars more than you should.

If you would like a mortgage review – FOR FREE – contact

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