Latest news with #NicholasEagar
Perth Now
16 hours ago
- Business
- Perth Now
Big four bank announces fresh blow to savers
NAB has become the latest bank to move on interest rates, cutting the rate of one of its more popular savings accounts. NAB has announced its Reward Savers account has fallen by 0.05 per cent for a new maximum rate of 4.35 per cent, in the second cut in less than a month. It follows a 25 basis points rate reduction on May 23 in line with the Reserve Bank of Australia's official interest rate reductions. Canstar called it a 'small blow' for savers. NewsWire / Nicholas Eagar. Credit: NewsWire Account holders with NAB's Reward Savers will now get a 30 basis point reduction on their money held in the account. Canstar data insights director Sally Tindall described it as a small blow for savers who are already watching their returns slip away. 'It shows that banks don't need a cash rate change to move the goalposts for customers. It's a small move but a disappointing one nevertheless,' she said. According to Canstar, NAB is not the only bank moving on rates, with Australians now having just six banks offering at least one ongoing savings rate above 5 per cent including some young adult accounts and excluding those for children. 'While the average savings rate on our database is an uninspiring 3.07 per cent, there are six banks still offering an ongoing savings rate of 5 per cent or more,' Ms Tindall said. While each of the savings accounts comes with terms and conditions, including deposits and transactions, BOQ Future Super, BCU Bank Boss, P & N Bank Savvy Savers, MOVE Bank Growth Saver and ING Savings Maximiser all still offer rates above 5 per cent. Westpac Life Spend and Save also offers younger Aussies a 5 per cent savings rate, but comes with the major caveat of being for those aged 18 to 29. NAB announces a small cut to popular savings account. NewsWire / Gaye Gerard Credit: News Corp Australia Ms Tindall warned if the Reserve Bank cuts the cash rate again in July, which the bond market says has an 83 per cent chance of happening, the days of a 5 per cent savings rate could be behind us. 'If the RBA wields its knife again in July or August, savings rates starting with a 5 won't last beyond winter,' she said. 'Term deposit rates are, unsurprisingly, falling faster than at-call savings rates, as banks continue to bake in further cash rate cuts into the fixed rate term. 'If you're someone who likes the certainty and security a term deposit can bring, time is of the essence as these rates are likely to keep on falling in the weeks ahead.'
Perth Now
3 days ago
- Business
- Perth Now
Super shake-up set to help millions
Young Australians are on track for a 'comfortable retirement' thanks to a bump in the superannuation rate. Nearly 10 million workers will see their superannuation guarantee increase from 11.5 to 12 per cent starting from July 1. According to the Association of Superannuation Funds (ASFA), this increase means a median 30-year old worker making $75,000 a year will add about $20,000 to their superannuation balance by the time they retire. This $20,000 increase will mean the median 30-year old will retire with $610,000 in superannuation, above the $53,383 a year or $595,000 they would need for a comfortable retirement. Young Aussies are now on track for a comfortable retirement NewsWire / Nicholas Eagar Credit: NewsWire Couples should fare even better. ASFA says a couple requires $73,875 a year or $690,000 combined in total to live comfortably in retirement using their super plus age pension top-ups. The major caveat to these figures for singles and couples is owning your own home by retirement. ASFA chief executive Mary Delahunty called the bump in superannuation guarantee a major milestone for Australia's retirement system. 'With the super guarantee increase to 12 per cent, we are seeing super fulfil its objective of providing a dignified retirement for ordinary Australians, with today's 30-year-old reaping the rewards of decades of progress in our world-class super system,' she said. The ASFA breaks down the difference between a modest and comfortable lifestyle into 10 categories. A comfortable lifestyle includes better health insurance, faster internet, a more expensive car, regular leisure activities and an annual domestic trip as well as one overseas trip every seven years. Australian workers are being urged to check their pay slips, as the rise in superannuation guarantee could impact take-home pay. NewsWire / John Appleyard Credit: News Corp Australia CPA Australia superannuation lead Richard Webb said while the increase in the superannuation guaranteed would have a long-term benefit to retirement savings, he warned workers to check their pay slips. 'If your employment contract includes a total remuneration package including super, this could mean less take-home pay at the end of the month,' he said. 'However, for those on award or enterprise agreements, your pay agreement is more likely to be a salary, which means the change will not affect your take-home pay. 'It's a good idea to check with your employer to see how they view the changes and what it means for you, otherwise, you might get a shock if your take-home pay is a little less than expected.' Retirement more expensive Despite the median Australian now having enough to retire comfortably, costs are still rising for those who are retired. These expenses climbed 1.6 per cent in the year to March 31 – a figure still below the consumer price index increase of 2.4 per cent, in part due to rents jumping by 5.5 per cent to the 12 months until March 2025. NED-9108-Monthly-Inflation-Indicator Eating was the main contributor to this, with fruit and vegetables rising by 6.6 per cent as well as meats and seafood jumping by 4.3 per cent for the year. Electricity prices rose sharply in the March quarter, reversing sharp falls over the last six months, as several state-based subsidies came to an end and Commonwealth electricity subsidies had timing issues. The federal government will add two more quarterly payments of $75 in energy subsidies until the end of 2025. Ms Delahunty said while retirees were getting some relief from slowing inflation, essential costs remained a concern. 'Australians in retirement are starting to benefit from a slowdown in inflation, but the prices of essentials are still rising. It's a timely reminder that achieving a dignified retirement takes planning, and superannuation plays a critical role in making that possible,' she said.
Perth Now
13-06-2025
- Business
- Perth Now
Big four bank announces interest-rate cut
Lenders are cutting rates and fighting for market share weeks after the Reserve Bank of Australia moved on interest rates. This time the major banks are fighting over investment loans, with CommBank slashing variable rates for investors. The major bank, which already offered the lowest investor variable rate, reduced rates even further to 5.69 per cent. These cuts of between 0.07 and 0.12 percentage points apply to the bank's digital-only investor home loan and are for new customers only. This follows the RBA reducing the official cash rate by 25 basis points to 3.85 per cent after its May meeting. All four banks immediately announced they were passing on an interest-rate reduction. The big four banks are moving on interest rates outside of the RBA cash decisions. NewsWire / Nicholas Eagar Credit: NCA NewsWire Canstar data insights director Sally Tindall said CommBank's latest move was designed to further consolidate its dominance in the investor mortgage market. 'This cut is good news for new borrowers, but existing CBA investors might be frustrated to see better deals going to new business while they continue to pay more,' she said. 'It will be interesting to see if any of CBA's key competitors chase after it with investor rate cuts of their own. Westpac is best placed to do this with a gap of just 15 basis points between the lowest investor rates from each bank.' Competition among the major banks is heating up as they reduce interest rates. NewsWire / Luis Enrique Ascui Credit: News Corp Australia Westpac and ANZ's lowest investor variable rates are 5.84 and 5.89 per cent respectively. NAB is the only big four bank not offering an investor variable rate under 6 per cent, but the NAB-backed UBank's lowest investor variable rate sits at 5.74 per cent. 'With variable rates likely to come down further, easing the pressure on borrowers across the country, we could see banks' appetite for investor loans increase,' Ms Tindall said. 'Right now, the gap between the average owner-occupier rate and the average investor rate is just 0.22 percentage points; however, this could get even narrower if competition continues to heat up. While CommBank is lowering interest rates on investment loans, Canstar warns the quality of the property will be a key determinant of whether investors can get the loan. 'The banks aren't likely to be rolling out the red carpet to every borrower,' Ms Tindall said. 'They're going to want quality investments, ideally where the rental return is still strong and the owner has a good track record of paying their loan on time.'
Perth Now
13-06-2025
- Business
- Perth Now
‘Hard truth': Millions face energy price hike
Cash-strapped Aussies are being warned the 'cold hard truth' is electricity prices are on the rise this winter in the latest cost-of-living blow. After the Australian Energy Regulator made its final determination for the Default Market Offering back in May, millions of households will now be getting letters or emails about their new energy rates. The offer sets the maximum price caps for bill increases for customers paying for default plans. These prices are meant to protect Australian households who don't shop around as well as provide a consistent benchmark so people can find an alternative retailer. Millions of Aussies face higher electricity prices. NewsWire / Nicholas Eagar Credit: NewsWire Canstar's analysis shows Sydney electricity prices are going up 8.6 per cent, meaning the average family will now pay $145 more for their power or $1830 a year. Melbourne energy prices spiked 6.2 per cent or $83 for the average household, setting families back $1421, while Brisbane prices are up 3.7 per cent or an average of $72, with the standard household now paying $2019 per year. Canberrans will get the nastiest shock with their electricity prices going up 8.5 per cent and the average household now paying a further $191 to $2436 a year, while Adelaide households will pay on average $70 more a year or $2247 in total. These figures exclude the federal government's $75 subsidy. Under the extension of the Government Energy Bill Relief Fund, every household will get two payments of $75 a quarter automatically applied to their energy bills. Prices will vary depending on where you live, with the maximum price going up by $191. NewsWire / Emma Brasier Credit: News Corp Australia Canstar data insights director Sally Tindall said while it was never fun to read about price hikes, Aussies should 'grit their teeth' and see if they could find a better deal. 'The cold hard truth is that electricity price hikes are pretty much inevitable in states such as NSW, Queensland and South Australia this winter after the regulator approved hikes to the reference prices across all networks in these states,' Ms Tindall said. 'The exact costs for your daily supply charge and electricity rates are up to each provider; however, unless you're on an embedded network or in a state where there are limited options, this is one bill you can, and should, take control of.' Ms Tindall urges households to check the 'reference price' they receive in the next two weeks and compare it with other market offers. 'Electricity bills can often be ridiculously confusing, with daily supply charges, tiered electricity rates, time of day pricing and whether you've got a controlled load,' she said. 'However, if you just want to compare your options without getting into the weeds, the reference price is your friend.'
Perth Now
10-06-2025
- Business
- Perth Now
‘Figure just thrown around': Super myth busted
Older Australians are likely closer than they think to having a comfortable retirement, with workers often overestimating just how much they will need before they finish their careers. The majority of workers believe they will need at least $1m in their superannuation fund in order to have a comfortable retirement, new research AustralianSuper research reveals. AustralianSuper head of advice Ross Ackland said 94 per cent of retirees would finish their careers with far less than $1m in superannuation, and despite the fear-based narrative, that would still be enough to live a comfortable life. 'You might have heard you need $1m – it's the figure that's often thrown around as the financial retirement ideal, but the truth is, there's no one-size-fits-all,' he said. 'A comfortable retirement will look different for everyone.' Australians might be able to retire with less in their super than they think. NewsWire / Nicholas Eagar Credit: NewsWire Figures released earlier in the year by Super Consumers Australia showed a single person needed about $310,000, while a couple needed $420,000 to achieve a 'medium lifestyle in retirement'. But this has two major caveats; the retiree owns their own home and they go on the aged-based pension at some point throughout their retirement. The Association of Superannuation Funds of Australia has also run the figures, saying singles living a modest lifestyle will spend $32,930 a year, again assuming the retiree owns their own home. For Aussies wanting a 'comfortable' standard, singles need a higher amount of $51,814 and couples $73,031 a year. This would require a single superannuation member to have $595,000 in their accounts, while couples need to have $690,000. Retiree Warren Morrison said after a career in local government, banking and media, he was able to retire in 2022 at aged 64 with far less than 'a million bucks in super'. 'I worked out what I'd need day to day, figured out what brought me joy and built my retirement around that, eventually leaving the workforce with around $350,000 in superannuation,' he said. 'I'm not sitting still – I'm officiating weddings, hosting trivia nights, doing a bit of acting and even judging roller skating competitions. 'It's not about being rich, it's about being purposeful. I still have my coffee and cake with mates. I'm careful, but I'm not missing out.' Workers are being urged to figure out how much their lifestyle costs. NewsWire / Emma Brasier Credit: News Corp Australia AustralianSuper points out funds in superannuation are just part of what retirees will have when they finish work, with savings, other assets, lifestyle expectations and the pension all playing a role in how Australians will be able to spend the latter years of their lives. 'We know superannuation is incredibly important and encourage members to make extra contributions where appropriate, but super is only one piece of the retirement puzzle,' Mr Ackland said. 'It's also important to remember that our superannuation system is still maturing and will continue to deliver stronger outcomes for more Australians.' Compulsory super was only introduced in 1992 and at much lower contribution rates than we have today. The superannuation guarantee has also been on the rise in recent years and, from July 1, 2025, will climb to 12 per cent of a worker's income.
