A change to the way interest is calculated could bring welcome savings
It’s hard to believe but, at one stage, some lenders would direct any additional repayments made on your home loan to pay off your accrued interest first rather than use it to knock down your balance. It may seem like a minor detail but because the interest is calculated on your daily balance and charged monthly in arrears, this sneaky process clearly favoured the lender.
Thankfully, as Canstar’s Steve Mickenbecker says, “most interest rate quirks have largely been eliminated”.
Still, the latest reform proposed by the Australian Bankers’ Association highlights the need to understand how interest is calculated, especially on credit cards.
The ABA has made a number of proposals toward better banking (see The Buzz, page 12). For credit cards, the one that stuck out for me was the proposal that customers pay interest only on what remains on a credit card, and not on the full amount of purchase if a loan is being paid down.
Bu hikaye Money Magazine Australia dergisinin February 2018 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Giriş Yap
Bu hikaye Money Magazine Australia dergisinin February 2018 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Giriş Yap
An outrageous, beautiful monopoly
Telstra's mobile business is a cash machine with few competitors, giving it the highest returns in the world.
Drop the anchor to judge value
Buying and selling decisions should be based on where a stock price is going, not where it has been.
Powering the AI boom
Beyond the software and chipmakers, where will the energy come from?
Get into life
Tucked inside super are products that can protect you from life's inevitable uncertainties.
Paths to home ownership
Taking the road less travelled can sometimes deliver unexpected benefits.
Sold! Quick ways to add value
Small, strategic changes can have a big impact on the look and feel of your home. And get you a better price on auction day.
Money lessons the kids need to know
Your children can learn a lot from your past money mishaps. Here are eight financial conversations I have had with mine.
Property-investing rules: are they likely to change?
The pressure for the government to curb the tax benefits of tax concessions, such as negative gearing and the capital gains tax discount, is unrelenting. Most recently, independent senators David Pocock and Jacqui Lambie proposed five options for paring back investment property tax concessions, with savings to the Federal budget of up to $60 billion over the next decade.
What's love got to do with it?
A rollercoaster of emotions could be driving poor crypto behaviour.
Are we ready to be cash-free?
Saying goodbye to our piggy banks too soon could leave small businesses in the dark when problems arise.
