Latest news with #Megginson
Herald Sun
15-05-2025
- Business
- Herald Sun
Top reasons stopping Aussies from financial success
The cost of living crisis has pushed many into high levels of financial stress, yet comparison site Finder discovered many are sabotaging themselves even further. A survey of 1,011 respondents from Finder revealed that most Aussies are setting themselves up for financial failure and have exposed the biggest obstacles that stood in the way. The most common barrier was wasteful spending with the average Aussie wasting $154 per month. Over a third of respondents said the biggest waste was spending too much money on shopping, according to Finder. MORE: Insane demands of mega wealthy exposed by staff Other money mistakes included paying bills late, which one quarter of respondents were guilty of, one in five fell into credit card debt and 20 per cent said they spent too much money at bars, pubs and clubs. Sarah Megginson, personal finance expert at Finder, said majority of Aussies are unknowingly standing in their own way. MORE: Simple way to unlock $20k in extra home value New neighbourhood coming to Sydney 'Most people don't have a money problem – they have a mindset problem. Breaking these patterns could be the difference between staying stuck and building real financial freedom. 'The idea that you're 'too old' or 'too busy' to build wealth is a myth – and one that's costing Australians dearly.' Another major roadblock was that one in five felt their lack of financial knowledge was preventing them from financial success. 'These blockers are silent wealth killers – they creep into our everyday choices and steal opportunities,' Ms Megginson added. MORE: Alarming way Gen Z are getting homes What homes will be worth in each suburb by 2030 'But the good news is once you are aware of them, you can change them.' She urged Aussies to scrutinise all their living costs to free up more discretionary income. 'It's never too late to take control – increasing personal wealth does require a plan and discipline to reach your goals,' she said. Young Australians wasted the most money, according to a Finder survey, with gen Z admitting to wasting a whopping $237 a month, compared to just $65 by baby boomers. Finder money expert Rebecca Pike said whether you're wasting $5 or $500, it all adds up. 'It's not about living like a monk – no one is saying not to have fun and enjoy yourself from time to time,' she said. 'The more you can segment or budget what you will spend for fun, the better. 'Once you think about spending as a long-term investment rather than short-term indulgence, the more you will actually enjoy when you do splurge.' Ms Pike said even small changes can have a big impact. 'When you add it all up, that's money you could be saving for a home deposit, a holiday, or just a rainy day. 'Redirecting just a small portion of that could set you up for greater financial security, whether it's building savings or paying off debt.' Her tips included manually tracking your spending, through apps like Gather or WeMoney and putting savings into a high-interest savings account. 'It's a low-risk way to let your money grow – helping you build a financial cushion.' Other tips included putting 24-hours between unplanned purchases and unsubscribing from tempting emails and alerts. MORE: Top NSW regions for lifestyle and investors Oroton heirs' stunning $30m payday
SBS Australia
04-05-2025
- Business
- SBS Australia
Aussie shoppers in home brand shift — but is there a catch to lower prices?
Coles suggests that one in three customers are buying more home brand products to save at the check-out. But why are they so cheap? Source: Getty / Jacobs Stock Photography Ltd As grocery prices continue to climb, amid a broader , Australians are looking for any way to save. And it turns out that might mean re-entering the sometimes stigmatised territory of buying home brand alternatives. The latest quarterly update from supermarket giant Coles found that one in three customers were buying more home brand products to save at the checkout. But what is a home brand product — and does the lower price come with a catch? Home brand groceries — or private labels — are items made specifically for supermarkets and sold under their branding. In some cases, the exact same factory might produce a fancier brand of tinned tomatoes and a supermarket's home brand variety. "That doesn't mean the product is always exactly the same as the 'branded' product; it just means it was made at the same factory," Sarah Megginson, media spokesperson at financial comparison site Finder, told SBS News. "In some cases, the product is indistinguishable from the brand name, and in other cases, it tastes or works completely differently," she said. There are a few reasons why home brand products cost less than branded ones. Megginson points to reduced packaging costs, fewer or no margins for intermediaries in the supply chain, and sometimes lower ingredient or formulation costs. But the biggest factor? Minimal marketing spend. "Brands not only invest huge dollars in brand development and marketing campaigns for their products out in the world, but they also spend a small fortune with Woolworths to secure 'shelf space' in the prized eye-level shelves or end of aisles," she said. "Home brand products are obviously not investing in this — they're happily sitting on the bottom shelves, out of the way of their more expensive counterparts." "They are almost always cheaper than brand names and when budgets get tight, they're a great option if they do the job on a taste — or in the case of cleaning products, a performance — basis," Megginson said. Kate Browne, head of research at Compare Club, says home brand quality in Australia is "very good". The only thing you might miss is a range of options. A home brand pasta sauce might just have tomatoes in it, she says, while a branded version could include basil, garlic, or other flavours. Sometimes, price differences also come down to extras — like whether your tinned tomatoes have a ring-pull lid or not. According to CHOICE, the answer is yes — often better than you'd expect. The consumer advocacy group has tested a number of home brand products over the years and says they frequently outperform pricier alternatives. "We've found this happens across a number of categories, including tea bags, coffee, ice-cream, dishwasher detergent, toilet paper, and more," a CHOICE expert told SBS News. "For example, our most recent tea bag test found that Aldi's Just Organic Black Tea was the highest scoring overall out of 32 tea bag brands. At just 6 cents per bag, we found they were a cheaper and better-tasting option than brands like Lipton, Twinings, Tetley, and T2." For supermarkets, home brand products can be more than a budget-friendly option for shoppers — they're also a profit booster. "Supermarkets love home brands because they own those brands," Browne said. "We've seen a huge shift in the way our supermarkets in Australia retail. Ten or 12 years ago, there were a lot more name brands. Now we've seen a huge shift to more and more supermarket-owned brands, and that is purely for profit." Browne explains that when supermarkets deal with name brands, they have to manage external retailers and suppliers, which can cost more. With home brands, they cut those ties — and keep more of the margins. While it can mean less choice for consumers, it often results in lower prices and more control for the retailers. As cost of living remains front of mind for many Australians, our shops are now looking a little different. A January survey from CHOICE found 84 per cent of households are concerned about the cost of food and groceries. "Due to rising costs, many people are switching to cheaper products to save money on their grocery bills," CHOICE said. A January Finder survey of 1,013 people found that 39 per cent are switching to cheaper brands due to financial pressure. Similarly, Compare Club research found that 80 per cent of Australians are experiencing high or extreme levels of bill stress, with half of them cutting back on essentials like food and fuel. "We're seeing a lot of shift in behaviour. Concerningly, we're seeing people rely on buy-now-pay-later to buy groceries in some scenarios," Browne said. "But we're also seeing people being a lot more agnostic around brands. People are looking for the cheapest." She also says people are now shopping around at multiple stores before heading to the big supermarkets in a bid to save some cash. "They're looking for the best possible deal and they're trying new brands." Once considered a last resort, home brand products are now a regular feature in many households — and the stigma is fading. "We've seen a real big shift over the last couple of decades around home brands," Browne said. "There was a bit of a stigma back in the day, but now we've seen them become a real game changer in the market."
Canberra Times
29-04-2025
- Business
- Canberra Times
This change could see a couple be able to borrow up to $100k more on their home loan
New research says the current three per cent mortgage stress test is locking too many Australians out of home ownership - not because they can't afford a mortgage, but because the rate isn't changing with the current climate. Research found that a 0.5 per cent reduction in the buffer could boost borrowing capacity by 5 per cent and a tidy $276 billion nationally. Pic: Shutterstock Commissioned by the Finance Brokers Association of Australia (FBAA), the research revealed that lowering the home loan serviceability buffer to 2.5 per cent would boost borrowing capacity and allow hundreds of thousands of hopeful homeowners to qualify for a loan. The research found that a 0.5 per cent reduction in the buffer could boost borrowing capacity by 5 per cent and a tidy $276 billion nationally. It would see around 270,000 more people qualify for a median home loan, with almost 400,000 first-home buyers aged 25 to 34 feeling the biggest benefit. FBAA Managing Director Peter White AM believes it's a reform that could change people's lives. "We've said for a very long time that this simple move would make a massive difference to the housing market because we are talking about people who can afford to service these loans." With first-home buyers struggling in an ongoing housing hellscape, housing reform is a major focus of the upcoming election. Mr White said the current rate is "unrealistic" and that the FBAA had given the research to both the government and opposition. What are the positives? Lowering the serviceability buffer from three to 2.5 per cent would have an immediate effect - allowing more people to qualify for home loans and increase their borrowing power. "This change would make a big difference for those who were on the edge of being able to buy," said Finder's personal finance expert Sarah Megginson. "This shift just unlocks that little bit of extra borrowing power, which is going to make the difference and allow them to get the home." Based on a single person with the average Australian salary of $102,000, Ms Megginson outlines that the 5 per cent boost would change that person's borrowing power by about $55,000. "For a couple, that would make it closer to $100,000 - so it does make a big material difference on what you can afford to borrow." It would also be a welcome respite for mortgage holders who've been unable to refinance since rising interest rates. Mr White said the research confirmed that the reduced buffer may "ease loan stress among current mortgage more are freed up to refinance." Mr White said the research confirmed that the reduced buffer may "ease loan stress among current mortgage more are freed up to refinance. Pic: Supplied "This will free mortgage prisoners who are locked into higher rates unable to refinance due to the serviceability rate." Ms Megginson believes a lower buffer for existing mortgage holders makes the most sense. "I am actually more in favour of it for refinancers because they're already in the market. "If you're refinancing, you're not taking supply, so you're not driving up prices in the market to someone who's going from a renter to a buyer." Renters also would see benefit from a change. Mr White said a reduction in the buffer will ease pressure on the rental market from both ends, allowing more people to buy, and ensuring those with existing loans don't end up renting again. Are there any downsides? Housing issues in Australia are complex, and a multi-faceted approach is needed to adequately address the nuances we're currently facing. For this reason, Ms Megginson is hesitant that dropping the buffer is unequivocally positive. "I'm not certain that it's the right decision to make as it really does depend on an array of other policy changes. [With the election] we need to be wary of too many policies that will end up driving too many people into the market at the same time." One major concern is that lowering the buffer will increase home values, as a boost to borrowing capacity will push more buyers into the market when there is already low supply - pricing out the very buyers it meant to help. "The change would mean everyone has increased borrowing capacity at the same time," said Ms Megginson. "The change would mean everyone has increased borrowing capacity at the same time," said Finder's personal finance expert Sarah Megginson. Pic: Supplied "But if we're not addressing the supply of housing in Australia, where we've been undersupplied by over 100,000 homes a year for about 20 years, the impact is that houses will go up in price because demand has suddenly increased." Without addressing supply, we kick affordability issues down the road to the next generation. "Any initiative to make housing more accessible has the potential to result in property values increasing due to supply and demand, but the bottom line is that this is a very effective way to help hundreds of thousands of people enter the market, and remain in the market," said Mr White. Ms Megginson also holds concern that first-time buyers could wind up in financial stress. "Just because your borrowing power increases doesn't mean you're going to be able to service at that higher level. A lot of first-home buyers are going to be stretched," she said. "The reality of what it's actually like to pay a mortgage can be jarring. "First-time buyers need to go in with their eyes wide open to the extra costs of buying a home: maintenance, rates, insurance, if you're in an apartment, strata levies - these extra costs that you didn't pay when renting can eat into your affordability."
News.com.au
28-04-2025
- Business
- News.com.au
Aussies' $3k loss could flip script on interest rate cut
Aussies are planning to hunker down this year and save rather than spend in a trend expected to drag on businesses and stymie economic growth and property prices. New polling has revealed 'rebuilding savings' has emerged as the top financial goal for Aussies this year, with respondents indicating they planned to save more even if interest rates were cut. It suggests widely anticipated cuts in interest rates later this year, which would have the aim of boosting a sluggish economy, may not produce as large an economic sugar hit as regulators would like. If this scenario plays out it could mean the decision by more Aussies to save, rather than spend, will lead to a higher chance of further RBA cuts down the track. A common reason Aussies wanted to save more money and reduce their spending was due to cost of living pressures and a financial hangover from years of higher interest rates, the polling showed. Nearly half of all Australians surveyed said they had dipped into their savings within the last year to manage living expenses The average Aussie withdrew $3,600 from a designated savings account over the past 12 months to cover everything from medical treatment to mortgage repayments. The research found 18 per cent of Australians had depleted their savings to pay for everyday essentials, while one in 10 raided their savings to pay for an emergency expense. With their savings now depleted, a third of Aussies said their top financial goal this year was to save more and rebuild their bank balances. Another common priority was boosting income, with about a quarter of Aussies saying this was their biggest financial goal for the rest of the year. Finder personal finance expert Sarah Megginson said Aussies have set their sights on recovery. 'People want to regain a sense of control over their money, whether that's by increasing their income, reducing debt, or boosting their super,' she said. Ms Megginson said the trends pointed to a climate of lower economic sentiment. 'When people prioritise saving over spending, it can directly reduce consumer demand for goods and services,' she said. 'This can lead to decreased sales for businesses, which can have the impact of prompting them to cut back on staff hours, headcount and production. 'Since consumer spending is a major driver of economic growth, a sizeable drop can slow down the economy.' Ms Megginson noted that increased savings was a good thing at an individual household level. 'For individuals, higher savings can provide a necessary financial buffer against unexpected expenses or economic downturns.' Rebecca Pike, money expert at Finder, said the cost of living has negatively impacted the wealth status of Australians. 'It's disappointing that households had to empty their savings to stay on top of expenses. 'From health crises to job losses, millions have had to turn to their savings to get themselves or someone they know out of trouble.' Ms Pike said the cost of living is to blame. 'Many are struggling to pay their bills and are left to dip into their savings jeopardising their financial goals.' Westpac last week announced it expected the Reserve Bank to cut the cash rate by 0.25 per cent at its May meeting. Interest rate cuts have historically driven up home prices but the boost from another cut may be less pronounced this time due to looming global uncertainty. Westpac's chief economist Luci Ellis told 'turmoil abroad' suggested a weaker economic environment ahead. 'Global growth – and especially US growth – will be slower; the response of China will be disinflationary for the world outside the US; and uncertainty is likely to delay decisions on some investment projects.'
Daily Telegraph
28-04-2025
- Business
- Daily Telegraph
Aussies' $3k loss could flip script on interest rate cut
Aussies are planning to hunker down this year and save rather than spend in a trend expected to drag on businesses and stymie economic growth and property prices. New polling has revealed 'rebuilding savings' has emerged as the top financial goal for Aussies this year, with respondents indicating they planned to save more even if interest rates were cut. It suggests widely anticipated cuts in interest rates later this year, which would have the aim of boosting a sluggish economy, may not produce as large an economic sugar hit as regulators would like. If this scenario plays out it could mean the decision by more Aussies to save, rather than spend, will lead to a higher chance of further RBA cuts down the track. A common reason Aussies wanted to save more money and reduce their spending was due to cost of living pressures and a financial hangover from years of higher interest rates, the polling showed. MORE: Aussie landlord's horror after 12 homes stolen MORE: Suburbs with worst tenants revealed Nearly half of all Australians surveyed said they had dipped into their savings within the last year to manage living expenses The average Aussie withdrew $3,600 from a designated savings account over the past 12 months to cover everything from medical treatment to mortgage repayments. The research found 18 per cent of Australians had depleted their savings to pay for everyday essentials, while one in 10 raided their savings to pay for an emergency expense. With their savings now depleted, a third of Aussies said their top financial goal this year was to save more and rebuild their bank balances. Another common priority was boosting income, with about a quarter of Aussies saying this was their biggest financial goal for the rest of the year. Finder personal finance expert Sarah Megginson said Aussies have set their sights on recovery. 'People want to regain a sense of control over their money, whether that's by increasing their income, reducing debt, or boosting their super,' she said. Ms Megginson said the trends pointed to a climate of lower economic sentiment. 'When people prioritise saving over spending, it can directly reduce consumer demand for goods and services,' she said. 'This can lead to decreased sales for businesses, which can have the impact of prompting them to cut back on staff hours, headcount and production. 'Since consumer spending is a major driver of economic growth, a sizeable drop can slow down the economy.' Ms Megginson noted that increased savings was a good thing at an individual household level. 'For individuals, higher savings can provide a necessary financial buffer against unexpected expenses or economic downturns.' Rebecca Pike, money expert at Finder, said the cost of living has negatively impacted the wealth status of Australians. 'It's disappointing that households had to empty their savings to stay on top of expenses. 'From health crises to job losses, millions have had to turn to their savings to get themselves or someone they know out of trouble.' Ms Pike said the cost of living is to blame. 'Many are struggling to pay their bills and are left to dip into their savings jeopardising their financial goals.' Westpac last week announced it expected the Reserve Bank to cut the cash rate by 0.25 per cent at its May meeting. Interest rate cuts have historically driven up home prices but the boost from another cut may be less pronounced this time due to looming global uncertainty. Westpac's chief economist Luci Ellis told 'turmoil abroad' suggested a weaker economic environment ahead. 'Global growth – and especially US growth – will be slower; the response of China will be disinflationary for the world outside the US; and uncertainty is likely to delay decisions on some investment projects.'
