5 Moves to Recession-Proof Your Home Loan

The Australian economy is sending serious warning signs of an incoming recession. To prepare for this, Joe and Michael shared five home loan strategies that can help save you thousands of dollars each month. From stretching your home loan to utilising your offset account to its fullest, there’s something here for every homeowner and investor to help shield their assets. 

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Transcript

Recession Fears And Petrol Shock

SPEAKER_02 0:00

Recessions are often unpredictable. You don't know when jobs could be cut. Everyone is still recovering.

SPEAKER_00 0:06

The globe is still recovering.

SPEAKER_02 0:07

And now we have a war and an oil crisis. I filled up last night at$3.10 a litre. Three weeks ago I filled up at$1.80. That's going to be an extra$4,600 I need to pay a year. At a time of recession, is the bank going to allow everybody to go in there and do 100k and pull it back? They can say no, we're going to put a halt on all redraw withdrawals.

SPEAKER_00 0:32

I want to make sure that we are recession proof. How do we do that?

SPEAKER_02 0:35

Oh Michael, there are so many things to help you battle a recession, but unfortunately.

No Fluff Recession Proof Plan

SPEAKER_00 0:45

Welcome back to the Finance Show with Joe. And today we're going to do something just a little different. No segments, no fluff. We're getting straight into it because the Australian economy is giving us some severe warning signs about our future. And Joe, I want to make sure that we are recession proof. How do we do that?

SPEAKER_02 1:02

Oh, Michael, there are so many things to help you battle a recession. Unfortunately, recessions are often unpredictable. You don't know where there's going to be a supply chain issue. You don't know when jobs could be cut.

SPEAKER_01 1:18

Yeah.

SPEAKER_02 1:18

And you also don't know if there's going to be any sort of deflationary practices or, you know, changes to tax structures.

SPEAKER_00 1:26

Yeah, because you and not because not every recession is the same either. Like they're all come from different reasons. Like there was the oil crisis in the 70s. We had the GFC, which was a housing thing. Sovereign debt crisis. Sovereign debt crisis. COVID. COVID. Yeah, COVID. That was our last recession in Australia. Correct. It was a quick, quick little, uh, quick little two-month recess, two-quarter recession.

SPEAKER_02 1:48

Well, I don't know if we actually went into a recessionary period during COVID. However, I'm talking about Australia particularly because the government rolled out as much as it could to prevent us from going into a recession. But I do know America got hit hard. Way harder than us. Yeah. Um, lots of Europe got hit hard. They're still recovering. Everyone is still recovering.

SPEAKER_00 2:09

The globe is still recovering.

SPEAKER_02 2:10

And now we have a war.

SPEAKER_00 2:13

A new war.

SPEAKER_02 2:14

And an oil crisis. In today's episode.

SPEAKER_00 2:17

Yeah, we're not going to talk about that.

SPEAKER_02 2:19

In today's episode, I want to base this on what you can do with your home loan to basically protect yourself.

SPEAKER_00 2:26

Yeah, really from recession. Recessions are bigger than any individual. Correct. Any government, even. Like they can provide things to try and fix it, but that's it.

SPEAKER_02 2:39

Yeah, that's correct. So we've come up with five things.

SPEAKER_00 2:44

Yep.

SPEAKER_02 2:44

That if you do have a home loan or if you do have an investment loan, you can utilize or you can implement today. And now before we do go any further, I do want to note that the advice on this channel is general in nature. And should you need specific advice, please contact your financial advisor. In saying that, Michael, we've got five things to make you recession proof when it comes to property.

SPEAKER_00 3:08

Give me the good stuff.

Stretch The Loan For Cash Flow

SPEAKER_02 3:10

Okay. Give me the first thing I want to discuss is stretching out your home loan.

SPEAKER_00 3:15

Yeah. Okay. What? So, okay, standard home loan, 30 years, stretching it out. What are we talking about? Is this 40 years? Is this 35? Like what does this mean?

SPEAKER_02 3:24

I'm talking about people that have had their home loan for five, six, seven years already. So let's say you bought in 2018 or 2019 and you've had a home for seven years, and your home loan is now down to 23 years remaining, and you're making your principal and interest repayments. Now, there is, you know, this episode isn't about how to pay your debt off sooner. No, no, no. This isn't about how to um, you know, maximize your property portfolio and the I'm talking about just asset protection, yeah, protecting your cash flow.

SPEAKER_00 3:59

Yeah, this is sheltering yourself from the eventual economic storm.

SPEAKER_02 4:03

Yeah. So we've seen recently petrol has jumped up significantly. I filled up last night at$3.10 a liter. Three weeks ago, I filled up at a dollar and eighty cents.

SPEAKER_00 4:15

Remember when we thought that was expensive too? That was expensive. Yeah.

SPEAKER_02 4:18

That was expensive. But$1.30 extra at the pub, I got a 60-liter tank. That's$90 extra, I think.

SPEAKER_00 4:25

Diesel or petrol as well. I'm diesel. Diesel same.

SPEAKER_02 4:27

But I'm trying to, you know, I bought a diesel so I don't have to burn as much, but now I'm paying more money. Anyways, anyways. Yeah, that's another thing. That's another thing. But I'm thinking to myself, if I was a simple salaried employee, I wasn't a business owner, this is now costing me an extra$90 a week. Okay. If this costs me an extra$90 a week or a fortnight, whatever. Whatever it is. Yep. Okay. That's going to be an extra$4,600 I need to pay a year in petrol. If the petrol stays at that price,$4,680, if I want to be specific. If the petrol stays at that price. Yeah, yeah. But if my wage doesn't change, it's your purchasing power gone.

SPEAKER_00 5:09

Your cost of the cost of living pressures increase.

SPEAKER_02 5:11

Correct. Now with fuel, we also have to consider the cost of goods. Yeah. We also have to consider the cost of uh things like freight okay, imports, things become more expensive.

SPEAKER_00 5:26

With farmers as well, they they need diesel to power their equipment.

SPEAKER_02 5:30

Correct. So there is a there is possibility if we don't have a resolution soon that this is going to be a permanent effect. So to protect myself, okay, let's say I've had my loan for 23 years.

SPEAKER_01 5:43

Yeah.

SPEAKER_02 5:44

I will instead refinance and stretch it out to 30 years. So a good example of this is let's say I've got a million-dollar loan and I've got 23 years remaining on my mortgage and 6% in interest. Yeah.

SPEAKER_01 5:56

Okay.

SPEAKER_02 5:57

I did my maths earlier in preparation for this show. See, we don't just wing it. So let's say I've got 23 years remaining on my loan. That means my monthly repayments are$7,226. If I refinance it back out to 30 years, my repayments drop down to$5,996. Have I added years to my mortgage?

SPEAKER_00 6:24

Yes. Yeah, but you need you need the cash now.

SPEAKER_02 6:27

Correct.

SPEAKER_00 6:28

Yeah.

SPEAKER_02 6:28

Okay. That's$1,300 extra a month. That is$15,000 in a year.

SPEAKER_00 6:34

Yeah. And we just said that what$4,600 on just fuel alone if it stayed at this price. So there you go. You've shored up your fuel.

SPEAKER_02 6:41

Correct. So the first thing I'm really looking at is the opportunity or the possibility of stretching out my loan.

SPEAKER_01 6:47

Yeah. Okay.

SPEAKER_02 6:48

And I think people need to speak to a mortgage broker now because one of the issues that we have in Australia is our inflation isn't only caused by the war.

SPEAKER_00 6:58

No, no, there's a few things going into it.

SPEAKER_02 7:00

There's a few things going into it. So there's potential for our interest rates to stay stubborn and at that higher amount than coming down, even if the war ended tomorrow. Because yet again, there are other inflationary pressures that are causing our interest rates to stay so high.

SPEAKER_01 7:18

Yeah.

SPEAKER_02 7:19

So after I look at that, now this episode is coming out before the budget, our May 2026 budget.

SPEAKER_00 7:26

Yes.

SPEAKER_02 7:26

So there could be changes to investment loans.

SPEAKER_00 7:28

100%. Yeah. They're even talking about there's talk that there's big reform coming. Just talk. Just talk though.

SPEAKER_02 7:35

So, you know, removing the capital gains tax discount. When we don't have to focus on that too much. No. They might remove negative gearing. Yeah, which or limit link negative gearing.

SPEAKER_00 7:44

Yeah, which if you are relying on that, that cash back at tax time, maybe you need to start rethinking your strategy.

SPEAKER_02 7:51

Correct. However, for today's strategy, it still exists. So I'm going to include it. Yeah.

SPEAKER_00 7:57

No, no, no. That's fair because we don't know it's going to change. So let's not like prepare for Yeah.

Interest Only And Tax Benefits

SPEAKER_02 8:01

So step number two is possibly looking at interest only loans. Okay. Now, the reason why I say interest only loans is interest only, you can offset the principal and your repayments are usually lower than what a principal and interest repayment will be.

SPEAKER_01 8:20

Yeah.

SPEAKER_02 8:20

Now, I could tell you firsthand, because I deal with mortgages every day, interest only repayments are often at a higher rate. So a lot of the time people end up saying that, hey, wait, my repayments are pretty much the same. Why don't I switch to principal and interest? Haha, here's the beauty in it. Yeah. Okay. If you have an investment property, okay, and you instead utilize an interest only account, 100% of your interest repayments can offset your tax liability. What does this mean? I've got$5,000 a month that I'm putting towards my mortgage. Okay. That's$5,000 interest only. My rental income is$3,000. That$24,000 is the cost of my property because that's the interest offset plus strata. I can utilize all of that up against my personal taxes, tax return.

SPEAKER_01 9:16

Yeah.

SPEAKER_02 9:16

And I can reduce the amount of tax that I pay every single year and possibly receive a higher tax benefit. So step number two is I'm really, if especially if I've got an investment property, I'm really looking at interest-only options. And I'm looking at these specifically because there is so much tax benefit.

SPEAKER_01 9:38

Okay.

SPEAKER_02 9:39

That is today. The May budget could blow this up and change everything. That's true. And I advise if I'm going to offer any advice, I advise people speak to their mortgage broker today because right now, when we face a recession, the biggest thing that you've got to focus about, focus about, focus on is asset protection and cash flow protection.

SPEAKER_00 10:05

Yeah. Yeah, absolutely. Question for me of being uh of the ignorant unwashed masses. Um, how long do you have to can you do this interest rate? Does it obviously it has to be at least one financial year, right? Or interest only? Yeah, interest only.

SPEAKER_02 10:20

So interest only, as long as you don't fix your rate, which we'll get into later, but as long as you it you don't fix it, you can switch in between the products. However, they often only each lender is different. It's often one to five years. Now Westpac has recently brought out a 15-year interest only loan. AMP has their 10-year product.

SPEAKER_00 10:42

I'm sure somebody knows, it's not me.

SPEAKER_02 10:44

The issue with interest only loans, however, is you've still got the principal portion of it.

SPEAKER_01 10:48

Yeah.

SPEAKER_02 10:48

You still need to prove that you could pay off the principal in the amount of time that you've taken off the regular mortgage. So if I've got a 15-year interest only loan with Westpac, that means I need to pay off the principal in interest in 15 years.

SPEAKER_00 11:01

So if it's a million dollars and you you gotta pay a million dollars in 15 years.

SPEAKER_02 11:04

And that's a lot more.

SPEAKER_00 11:05

That's a lot more than 30 years. That's a lot that like a lot more money in a short amount of time.

SPEAKER_02 11:09

So that means you need a higher wage. So speak to your mortgage broker before you go and apply for any of these loans.

SPEAKER_01 11:16

Yeah.

SPEAKER_02 11:17

Don't go direct to the bank. And the reason why I say don't go direct to the bank, a lot of people don't know this. A bank will instantly submit your application in hope that it'll get approved. A mortgage broker, a good mortgage broker, yeah, won't submit an application unless they know it's going to get approved. So that's why I say speak to a mortgage broker first before you speak to a lender. Because the mortgage broker might also look at your personal situation and say, hold on a second, you're not good for a 15-year interest only loan because you're going to retire in five years.

SPEAKER_01 11:52

Yeah.

SPEAKER_02 11:52

How can I ensure that in 10 years' time you're going to be able to repay that?

SPEAKER_01 11:56

Yeah.

SPEAKER_02 11:56

Or another option is, oh, you're working casually, but you're a teacher. You're not suitable to this bank because they'll only take 80% of your income, but you're suitable to this bank because they'll take 100% of your income. Exactly. Okay. So don't do it yourself. Go to an expert, an actual expert, somebody that's been in the industry for a while.

SPEAKER_00 12:14

Yeah. Look at the testimonials, look at the case studies. Yeah. Do you do your due diligence?

SPEAKER_02 12:18

Do you do the, but make sure you're out there trying to protect yourself.

SPEAKER_01 12:24

Yeah.

SPEAKER_02 12:24

And the best way to protect yourself, I gave you reason number one, stretch your stretch out your mortgage. Try and stretch your mortgage. Okay. Not everybody can be applicable, but try and stretch your mortgage. Number two, if you have an investment property, switch to interest only. Okay. I don't often advise people with owner-occupied properties to do that. To do that. The reason why is the interest is not tax deductible.

SPEAKER_00 12:47

Because it's not an investment. That's the only time negative negative gearing applies. Correct.

SPEAKER_02 12:51

And the second reason why is the interest rates are higher on interest only loans. So if you switch your owner-occupied property to an interest-only home loan and the repayments are just a little bit, maybe just a little bit less, are you really benefiting? You're not.

SPEAKER_00 13:10

No, you're not because the the whole thing, like you want to bring down the principal, especially if it's your owner-occupied.

Offset Versus Redraw In A Crunch

SPEAKER_02 13:15

Yeah. Correct. Um, the next thing. Utilize your offset account.

SPEAKER_00 13:22

Oh, yeah. I this is something I need to get better at. Um, but uh again, as cost of living pressures get tighter, it's hard to just put money into the offset account, at least for me as well, because I gotta share it with three other people. So that makes it difficult to actually put money in and go, who's this what?

SPEAKER_02 13:39

Yeah. So with your offset account, your offset brings down the amount of interest that you are required to pay on each repayment. Now the offset account and your home loan interest are calculated daily by the bank. This is how they make money, the extra cents, the extra dollars, all that sort of stuff. But let's say I've got$10,000 over here in my offset account and my home loan is$600,000. Yeah. As opposed to me paying$600,000 in principal and interest, I'm paying$590,000 in principal and interest. Yeah. Now people often hear no, you should just make the extra payments, make the extra repayments, make the extra repayments. That's making the extra repayments is good on own occupied principal place of residence type properties. But when it comes to investment properties, you might be better off utilizing an offset. Another thing is when people say don't use the offset, don't apply for an offset account, go just get yourself a redraw facility. When you're paying into a redraw, you're technically paying more of your loan off. And even if your mortgage has unlimited redraw at a time of recession, is the bank going to allow everybody to go in there and dip 100 uh do 100k and pull it out? They can say, no, we're going to put a halt on all redraw withdrawals. So you need to understand the economics of it. I could tell you now, big banks are happy to cop a fine if it means protecting their share price and their shareholders.

SPEAKER_00 15:27

Yeah, I mean, they've got the cash. They can pay the fine.

SPEAKER_02 15:30

Correct. But they are more interested. If they say we're shutting down redraws, then ASIC has to do a massive investigation.

SPEAKER_01 15:38

Yeah.

SPEAKER_02 15:38

Three years down the line, okay, we found that you weren't letting people utilize their redraw accounts correctly. We're going to fine you$100 million. Okay, we're happy to wear that$100 million fine if that means we protected our bank and we didn't go a billion dollars into debt because everybody tapped into their redraw.

SPEAKER_00 15:57

Yeah,$100 million or billion, you know. It's not, it's not hard to pick up, pick one there.

SPEAKER_02 16:01

They they often weigh it up. And I'm not saying that I've been in that room, but we've often heard that banks are happy to pay the fine if it means protecting their share price and their shareholders and the big execs bonuses. So don't go into I'm just gonna use redraw, I'm just gonna use redraw. Speak to your mortgage broker.

SPEAKER_01 16:24

Yeah.

SPEAKER_02 16:25

Actually understand the difference between an offset account and a redraw account. Because an offset account, no matter what, a bank can't say you can't take out of your offset.

SPEAKER_00 16:33

Yeah, because that's just like well, it's yours. Yeah, yeah.

Cut Spending And Shop Around

SPEAKER_02 16:36

That's a bank account. Redraw? Yeah, that's a little bit different. Number four. This is one you're going to have to help me with. Audit and cut unnecessary expenses. This is a self-audit.

SPEAKER_00 16:52

Yeah, this is you have to take like, you'll be essentially, you gotta look at look at your finances, look at your statements, and just see what you're spending is how you want to live your life, right? This is what you want to spend your money on, you're happy doing it. Whether it's uh uh smoking, streaming, uh food, drink, anything, anything that's fun and good, you're just gonna have to make sacrifices. It's just straight, straight fact of the matter here. Maybe instead of having three streaming services, you pick one, go one at a time each month. What pick a show, we're doing this for this month, cancel it, go to the next one. You could do something like that. Um, catch public transport to work. That's a that's an easy one.

SPEAKER_02 17:29

I'm going to go one step further. Guys, everybody's got access to Microsoft Excel.

SPEAKER_01 17:36

Yeah.

SPEAKER_02 17:37

Pop it in there. Pop your expenses in and see what you can reduce.

SPEAKER_00 17:42

Especially if you're like honestly, a huge one as well. And if if this is an option for you, go to Aldi instead of Woolies or Coles. Like, Coles is literally in court right now for price gouging. So are they? Yeah. They got they got they got done. They were it was proved that their specials were not specials. Yeah, I actually did not know that. So yet again. Anyways. Yeah. So do do little things like that. Um, I know like outside, you know, if you're doing your snacks and your food, try not don't buy name brand stuff. If it depends, obviously, like shapes. If you like shapes, buy buy the shapes, it's all right. But if you've got if there is a cheaper alternative, at least in the short term, go with that. All these little things will add up over time and you don't even realize they do.

SPEAKER_02 18:25

I'm gonna go another step further than you. So we've got discretionary expenses.

SPEAKER_00 18:29

Yes.

SPEAKER_02 18:30

Then we've got plug them into an Excel spreadsheet. But another thing is look at your subscriptions or your annual costs. Oh, yes. Insurance. Your insurance premiums are going up again May 1st or April 1st. Okay. Insurance premiums go up all the time. You will often find a better deal out there if you go online and look for it, especially when it comes to health insurance or house building and uh building and home insurance, yeah, home and contents insurance. Make sure you've got the right insurance, make sure you're not underinsured, make sure that you're taking care of yourself, but always make sure that you're looking at those annual repayments. And why do I say this? Because if you're subscribed to an insurance provider and they can just tick up the annual Which they do, they just send you the receipt. Correct. And it happens to everyone. It's not a one-off, this is just a oh yeah. No, this is how these companies make money by increasing your premiums without you even knowing it. So have a shop around, especially right now, especially just before the annual repayments go up, and especially just before anything. Don't wait until it's too late.

SPEAKER_00 19:47

No.

SPEAKER_02 19:47

That's where that's where I'm going with this. So, you know, be proactive. Be proactive. Yes, correct. Okay. Especially right now. Everybody's got an hour. Get off TikTok.

unknown 19:57

Oh.

SPEAKER_00 19:58

Just put the phone down.

Fix Part Of The Loan Safely

SPEAKER_02 19:59

Just put the phone down. Just put it down. Just for one hour. Just sit behind your computer and find out what's coming out of your bank account, what you can actually minimize. Yeah. That's super important. Last item, and you know this, I know this, we've been doing this forever, but lock or fix a portion of your home loan. When I say fixed rates, okay, I don't like to fix an entire amount. I'm never going to advocate for fixing your entire home loan for five years, and that's the rate for five years, unless, you know, it was COVID times and it was 1.8%. Yeah, that's you know you take it. Yeah, you take you take that every day. But right now, what do yeah, what do we see? We see home loan rates around, let's say, 6.09% just for a regular home loan. Standard home loan. The fixed rates are higher than what they currently are. Okay, though than what the variable rate is, because banks are betting on the fact that the variable rate's gonna go up and up. So they offer the fixed rate at a higher amount.

SPEAKER_00 21:00

Yeah, because they're they're still covering themselves at the end of the day.

SPEAKER_02 21:03

But we also don't know if petrol's gonna keep going up. We don't know if groceries are gonna keep going up. We don't we don't know what we don't know.

SPEAKER_00 21:10

Yeah, there's no we can't predict the future.

SPEAKER_02 21:12

So keep a portion of your home on a fixed rate because at least you know some stability. There is some stability in your life. I don't know what petrol's gonna cost tomorrow. But at least I know 30% of my home loan is gonna cost this much. At least I know 40% of my home loans gonna cost this much.

SPEAKER_00 21:31

And it makes it easier to budget in that Excel spreadsheet that we were talking about earlier. Correct. That's I think I think a fixed rate is yeah, very good for someone who needs to budget and needs like clear structured. I need to know how much is going out of my account every month because especially if you've got kids and you need to make sure you've got to tuition feed them, clothe them, all the good stuff. Correct.

SPEAKER_02 21:51

But there's one thing about fixed rates that a lot of people don't tell you. With a fixed rate, they're not always 100% offset. Okay. So you need to be careful with your fixed rate as well. That's why we tell people fix a portion of your loan, because then your offset account can offset the variable portion of your loan. And also check with your bank what's the maximum in repayments I can make on a fixed rate loan. Because banks also cap the maximum extra repayments you can make towards it. So from memory, a lot of the banks cap it out$15,000 extra per year. Not everybody's got$15,000 to contribute extra. Okay, but let's say you've got a great fixed rate and then uh home loan rates go up to, I don't know, 9%. Yeah. I'm talking about the very like the overnight cash rate's gone up to six, and people are paying 9% interest on million dollar loans, and you've got a 6% fixed loan. All of a sudden your salary's gone up and you want to make extra payments. You can't.

SPEAKER_00 22:53

Oh, you can't.

SPEAKER_02 22:54

No, you can't make more than the set amount written in your loan contract. So always understand when you're fixing your home loan rate that number one, double check that your offset account is actually offsetting the fixed rate loan because chances are it's not. And number two, if you're going to make extra payments, make sure that you know understand what's the most you can make every single year. Yeah. Those are two very, very important things. And I think by conveying that message, people will have a better grasp or a better understanding of what the difference between fixing, uh fixing a rate and then expecting to, oh yeah, oh, I've got an inheritance, I'm just gonna go pay. No, it doesn't work that way. It doesn't work that way. So you've got to be very, very careful with your fixed rate loan as well.

SPEAKER_00 23:41

Yeah, okay. Well, that makes sense. Okay, so to sum up, essentially, fixed rate loan, it's not the purpose isn't to help you pay off your home loan faster, it's to provide the same payments throughout a set period of time.

Recap Act Early And Where To Get Help

SPEAKER_02 23:55

Correct. And during a recession, what's everybody looking for? Stability. Stability. And having just that one piece of stability, it does help a lot. Oh, yeah. So to summarize, number one, if you do have a home loan try and you do need the extra cash flow and you're trying to protect your asset, make sure you don't lose it or anything, stretch your loan. Look at those options because stretching your loan is a very powerful thing. If you could save yourself$1,300,$1,400 a month over a year that compounds, remember your home loan is not paid by your annual salary before your tax. It's paid by the money that you have after your tax. Number two, if you do have an investment property, I don't really like to offer this to people with own occupied properties. You can look at the options. We will look at it for you, but interest only on investment loans. And the reason is you can possibly look at the negative gearing benefits for now and take advantage of those. Now, I will always add speak to an accountant before you go and make the switch. And the because I'm not an accountant, but I can help you get the mortgage, I can help you get the debt, but I can't help you with filing your tax returns. So make sure you speak to your accountant before you apply for an interest identity loan on an investment property to see if you can take advantage of the negative gearing benefits. Number three, utilizing your offset account. Now, we've given the reasons why we like people utilizing their offset accounts. We just stated, hey, when you pay into redraw, I understand your lender said previously, oh, we'll give you unlimited redraw. There's a possibility that they could turn around and say, shit, we just lost a billion dollars in China. Not we're not doing letting people do unlimited redraw. Because the banks trade internationally.

SPEAKER_00 25:44

Yeah. And it's and it's the global economy that is facing like uh contraction.

SPEAKER_02 25:49

Damn straight of home moves. Number four, audit your accounts, audit your spending habits, and look at your subscription models. I'm not just talking about Netflix, I'm not talking about Amazon, I'm not talking about Disney Plus. I'm talking about your insurance, I'm talking about health insurance, I'm talking about your cars, I'm talking about uh any annual registrations that you need, anything like that. Shop around if you can and see what you can reduce. I know for a fact, because I've recently bought a new phone, that they don't have locked-in plans anymore.

SPEAKER_00 26:21

Oh, really?

SPEAKER_02 26:22

Well, that's what I have with Telstra. Okay, yeah, yeah. But I, for instance, am on the higher tier. Yeah, guys, I'm a busy person. I need the higher tier. I need to pay 150 bucks a month. However, if at any point in time I start realizing, oh shit, I can't drive to work because petrol's$3.20 a liter. And I'm not too sure if our listeners know this, but I live, I don't have a trade station near me. I can't get to work.

SPEAKER_00 26:48

There's no train station down south. Yeah.

SPEAKER_02 26:50

Um, but essentially, if I'm working from home, maybe I don't need as much data.

SPEAKER_00 26:55

Yeah.

SPEAKER_02 26:55

And because I'm in that particular plan with Telstra, I can reduce back down to the$60 plan and just use my home Wi-Fi from there.

SPEAKER_00 27:03

Little tip as well goes the Aldi plans, the prepaid plans, super cheap. All the data rolls over,$28 a month.

SPEAKER_02 27:10

We're not sponsored by Aldi, but we should be. Oh, honestly, if you want to save money. And then lastly, is lock in a portion of your loan if you can speak to a mortgage broker beforehand. How many fucking disclaimers do I need to put in?

SPEAKER_00 27:24

Anyways, half this episode's just disclaimers.

SPEAKER_02 27:26

But you need to give disclaimers, but I'm gonna use the word consider, consider locking a portion of your loan to a fixed rate. So at least you have some sort of stability in your life.

SPEAKER_01 27:37

Yeah.

SPEAKER_02 27:38

Okay. 60%, 70%, 80% of your loan. I don't know what I don't know. I'm I'm not there taking care of your loan. Get in contact with someone, get in contact with someone, get in touch with a broker, let them look at your scenario or your particular situation before you go and roll anything like this out.

SPEAKER_00 27:54

And let's not and don't wait until the news is telling you it's a recession. Do it now. Yeah, yeah. Pre-preplan. Pre-plan. Yeah. So if they're telling you we're in a recession, okay, now you're gonna have to rush all these things.

SPEAKER_02 28:07

Well, not only that, if they start telling you now we're in a recession, buddy, we're in a recession like six weeks ago. Right. Yeah, yeah, exactly. It's on the news. They just didn't want everybody to panic six weeks ago. And now they have to panic. Yeah. I know we've got some oil fucking rigs coming in. I know Albo's done some back in the deal with Trumpy over it, like for some.

SPEAKER_00 28:25

Yeah, like there's things are happening, but we're just just prep you can only take care of yourself and your family, obviously.

SPEAKER_02 28:31

And if I could just leave with one more thing. This wall's fucking dumb. It's so dumb, man.

SPEAKER_00 28:36

Like the like the more and more I just don't get it. I just I don't understand what the goals are anymore.

SPEAKER_02 28:41

It's just fucking dumb. It's so dumb. It's just it's it's it's it's it's like I'm sitting here feeling on my I had to drive 15 minutes to find petrol last night. Really? Yes. Fuck. I'm not kidding. I had to go for I had to so Illawong went to Menai. Menai didn't have any. So I had to drive to Pats though.

SPEAKER_00 28:59

It would be worse in your area because there's no stations. There's nothing. There's no stations. Like uh not petrol station, train stations.

SPEAKER_02 29:04

So get to Patsow, find somewhere, and I have to pay$3.10 a litre.

SPEAKER_00 29:09

That's crazy. I yeah, I've been lucky recently. My 7-Eleven up the road from me is not run out of anything yet. It's expensive, but it's it's not run out yet.

SPEAKER_02 29:18

But anyways, guys, if you liked any of the tips that you heard or you want to hear more from us, you can reach out to us at itsimple.com.au. We can help with all the things that we studied, except for auditing, and that's the that's that's on you. We can help you with your mortgage, all right?

SPEAKER_00 29:32

But we can refer a good account.

SPEAKER_02 29:34

Well done. That was a great sentence. But yeah, thank you so much for listening. I've been Joe, that's been Michael, and we'll catch you on the next episode of the Finance Show with Joe.

SPEAKER_00 29:42

See you guys.