Your Business Angels - Dollar got the blues

Dollar got the blues

02.08.2022

dollar got the blues
gettin lower every day
dollar got the blues
gettin lower every day
i wanna do something about it
folks if i only had my way

used to be 2 for 1
now it’s 1 for 2
used to be 2 for 1
now it’s 1 for 2
what in the world are we poor people gonna do?

As the Reserve Bank raises interest rates for the fourth time in four months, home loan borrowers are bracing for more repayment pain. An increase of about $475.00 per month per $500k of mortgage has accumulated since the rate hicks started.

The official interest rate is now at its highest level in six years, at 1.85 per cent, up from a record low

Bank customers could expect to see an average variable rate of 4.61 per cent if today’s RBA rate rise was passed on in full.  

“I’ve never seen interest rates as low as they have been in my life, and I am getting long in the tooth. The highest rate I ever paid on a mortgage was 18%, so there is a long way to go before we get there; so many with a mortgage have never seen their mortgage go up; these cycles are normal”.

In the scheme of things and my observations, $500.00 can be recovered by a few changes in lifestyle. Starting with owning a decent cookbook. Maybe buying not buying lotto tickets – and all those other things I can tell you will make me sound preachy – but you know I’m right.

How you act as a consumer is one thing – our genuine concern is for our clients in business.

  1. Prices are going up, have a plan to raise your prices. For those in trades, this can be a lot easier than for those who may be in a supply loop. It doesn’t take much to check around to see what others are doing, but you need to try and stay ahead of inflation or better.
  2. Check expenses in your business (including the drawings you are making on the business). Remember turning off a light means more now than ever; watching fuel consumption (how you drive) adds up.
  3. In some markets, consumers will spend less, and the businesses affected spend less than other businesses. So, look at where your business sits, understand what will affect you and adjust.
  4. Watch your competitors – some will make poor decisions under pressure – this is a time for an opportunity as it is for concern. What does your business do, can you expand or develop your offer, and what is your big audacious plan that you can talk to us about?

In every market, there are opportunities.

There may be adjustments that you should / could make now. Want to chat? Call your client coordinator and let us review your business, considering what may be ahead.


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