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Aussies should be aware of changes that will impact their finances in the year ahead, according to Finder,
From rate cuts to insurance hikes, Finder has compiled a list of key money changes and personal finance predictions for 2020.
1. First Home Buyer leg-up
Topping the list is the government’s First Home Buyer Scheme, which came into effect this January.
This will allow up to 10,000 buyers to enter the property market with just a 5% deposit saved.
Kate Browne, personal finance expert at Finder, said that 2020 is shaping up to be a positive year for prospective buyers, provided that rates remain low.
“The First Home Buyers Scheme means eligible Aussies may now be able to enter the market sooner, without paying lender’s mortgage insurance.”
Further cash rate cuts are also on the cards in 2020: 66% of Finder’s RBA panelists predict another cut in February.
This would see Australia’s official cash rate plummet to just 0.50%.
“Record-low interest rates mean that homeowners will be able to save a significant amount of money over the life of their loan as well.
“With over a million mortgage customers considering a switch this year, it will be interesting to see which lenders pass on the rate cuts, ” Browne said.
3. Open banking will arrive and get us a better deal
Open banking is also set to shake up the fintech sector this year, with the Big Four banks now required to provide access to customer and account data.
From July 2020, the Big Four banks will need to provide access to customer and account data for credit and debit cards, deposit accounts and transaction accounts.
This means Aussies will be able to share their personal transaction information to score themselves a better deal.
4. Neobanks will take off
Finder predicts there will be millions of new Neobank customers in 2020, as challenger banks like Xinja and 86 400 continue to take the industry by storm.
Browne said that neobanks are giving Aussies a taste of what open banking can do when it comes to their money.
“Neo Banks are offering innovative apps and products, as well as features like unique spending insights and bill reminders.
“In saying that, not all Aussies are ready to take the plunge just yet. Many people still feel more comfortable with a traditional bank or lender,” Browne said.
5. Health insurance hike
Health insurance premiums are also set to rise again this year. Premiums will increase on 1 April by 2.92% on average, though increases will vary across funds.
Browne said Aussies should always compare across providers to ensure they’re getting the best deal on their health insurance.
“Compare your premium every year and switch to a fund that won’t cost more. If you switch a policy with the same level of cover as your current one, you won’t need to reserve waiting periods,” Browne said.
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