Tax Time Ready

It’s tax time again! The end of the financial year seems to arrive quicker every year. This can be a stressful time of year that many of us might dread, however, utilising the end of the financial year can be the perfect opportunity to organise your finances.

To avoid the hassle of amendments and ensure your tax return is correct and complete, we recommend waiting until all of your information is available on your ATO records, including possibly:

  1. Your income statement/(s) status is “Tax Ready” before proceeding to lodge your return
  2. Ensuring Private Health Insurance Information is available
  3. Any other income, such as Interest, dividends and managed funds, is available on your ATO records

 

When to complete your tax return

When your income statement is marked as “Tax Ready,” it means your employer has finalised all relevant details regarding your wage, tax, and super contributions. Using this final information will ensure the accuracy of your tax return.

Lodging your return with a “Not Tax Ready” status means you will be relying on incomplete or estimated information, which will increase the risk of errors and potential discrepancies. If your employer finalises your income statement after you’ve lodged your return, you will need to amend your return, which can be time-consuming and may result in additional tax liabilities and penalties may apply.

 

Income Statements (Formally known as Payment Summaries or Group Certificates)

To proceed with lodging your tax return, you first must have a summary of employee income, which is also known as an Income Statement (Formally known as Payment summary or group certificate).

Every year, all workers must have access to this information provided by your employer by July 14th. The same deadline still applies, regardless of if the amount being withheld is $0.

 

Private Health Insurance

Due to recent changes made by the Australian Government, health funds are no longer obligated to automatically provide members with an annual tax statement via mail or email. If you file your tax return online using myTax or through a registered tax agent, you no longer need to manually enter your health insurance tax information, and it will be automatically filled in by late July.

If you and your entire family unit don’t have the appropriate private patient hospital cover, you may be liable for the Medicare Levy Surcharge (MLS) in addition to the 2% Medicare Levy. The surcharge amount does differ as it depends on your income and individual circumstances. By you and your entire family unit purchasing suitable hospital coverage through an approved health insurer, you can avoid this surcharge at tax time. (Please note that this can be apportioned on a adays basis where coverage commences part way through a year)

 

Home Office Deductions

The number of people working from home has increased since COVID-19. If you work from home, you may be eligible to claim deductions for related expenses. These deductions can include costs for stationery, energy, and office equipment.

Per 2023 financial year, there is two methods and both require you to maintain relevant records and documentation. This includes:

  1. Fixed Rate Method – Require a record of all the hours you work from home for the entire year
  2. Actual Cost Method – Require a record and documentation of all your home office expenses and the business use percentage

If you would like to check your eligibility and find out more information on what you can claim for, you can learn more here.

 

Support for Small Businesses

As part of the 2024–25 Budget on May 14, 2024, the government proposed an extension on the $20,000 instant asset write-off for small businesses by an additional 12 months until June 30, 2025. This measure aims to improve cash flow and reduce compliance costs.

Small businesses with a turnover of less than $10 million can immediately deduct the cost of eligible depreciating assets under $20,000. This applies to assets used or installed between July 1, 2023, and June 30, 2025. “Immediately deductible” means claiming a tax deduction in the same year the asset is purchased and used. For GST-registered businesses, the cost must be under $20,000 after GST credits; for non-registered businesses, it must be under $20,000 including GST, applying to each individual asset. (Please note that neither the 2024 or 2025 Financial Years have been Legislated yet and the Senate is requesting that the limit be set at $30,000).

 

Lodging your tax return with the Hrkac Group

If you need assistance with lodging your tax return or you have any questions about how to best prepare for tax time and maximise your return, The Hrkac Group team of accountants have the knowledge and are here to help make your life easier.

Get in touch and book your tax appointment with the HG Accounting professionals today! Call us on (03) 5224 2366 or book your appointment here.

 

General Advice Warning
This information has been provided as general advice. We have not considered your financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication. Whilst all care has been taken in the preparation of this material, it is based on our understanding of current regulatory requirements and laws at the publication date. As these laws are subject to change you should talk to an authorised adviser for the most up-to-date information. No warranty is given in respect of the information provided and accordingly, neither nor its related entities, employees, or representatives accepts responsibility for any loss suffered by any person arising from reliance on this information.
Liability limited by a scheme approved under Professional Standards Legislation.

 

 

 

 

 

 

Retirement Planning Geelong

Retirement – A phase many of us daydream about. Whether it involves spending more time with family, travelling the world, or volunteering for a cause we’re passionate about, one thing is certain: retirement costs money.

So, when should you take the plunge into retirement, and how much money is enough to comfortably retire on?

 

What Is the Best Age to Retire?

Ultimately, deciding when to retire is a highly personal choice. However, here are some key considerations:

Average Retirement Age: Of the 140,000 Australians who retired in 2020, the average age was 64.3. Most people still expect to retire in their mid-to-late- 60s.

 

Financial Factors

Your ability to finance retirement plays a crucial role. Key sources of income for retirees include:

  • Government Pension: Currently, the government pension is the primary source of personal income for retirees in Australia.
  • Superannuation: Many retirees rely on their superannuation funds or account-based pensions (drawn from their super balance).
  • Age Pension: For those born on or after 1 January 1957, the qualifying age for the age pension is 67.

 

Factors to Consider Before Retiring

  • Assets: Evaluate your assets, including home ownership, savings, and investments outside of super.
  • Annual Expenses: Understand your annual spending needs.
  • Savings: Decide how much you’re willing to dip into your savings.
  • Housing: Consider downsizing or selling your house.
  • Part-Time Work: Decide if you’ll continue working part-time after retiring.
  • Age Pension Entitlements: Keep in mind that earning over a certain amount per fortnight can affect the amount of pension you receive, however, recent changes allow an age pensioner to earn more from working without it affecting their age pension.

 

But it is not just about the money

While the financial aspects of retirement are vitally important, it is not the only consideration. In many ways, and perhaps more importantly, the non-financial aspects need to be considered carefully. Ask yourself, and honestly answer the following questions:

 

How will you spend your time?

A couple of weeks in retirement will just feel like being on holiday, but how will you adjust to every week being like the weekend?

 

Will you suffer from irrelevance?

When people are working and are part of a workplace structure, they have a certain status that comes with the position they hold. They may be an expert in a particular field. However, in retirement, that status may simply evaporate.

 

Has your health called “full time”?

For some, the time to retire may be heralded by physical or mental health concerns. Perhaps either the brain or the body is no longer able to cope with the day-to-day pressure of work. Sadly, for some, this may be at a time much earlier than they would have liked.

 

Caring for others

The current generation of people entering retirement is sometimes referred to as the “sandwich generation”. They become the carers for their grandchildren and their older parents and relatives. While the need to care for others will often be the driver behind people deciding to retire, careful consideration needs to be given to incorporating plenty of time for yourself. You should not swap one full-time job for another (unpaid) full-time job.

 

While finances and other personal circumstances can dictate the right time to retire, merely retiring because you have reached some arbitrary age dictated by a bureaucrat somewhere in their ivory tower should not be an option. Remember, in Australia, there is generally no mandatory retirement age.

Retire on your terms and when it is best for you. Seek qualified, independent financial advice to tailor your retirement plan to your specific circumstances. Remember, there’s no one-size-fits-all approach, but thoughtful planning can help you transition into a fulfilling retirement phase.

 

The content within this blog has been sourced from our Licensee, Alliance Wealth’s blog ‘Realise Your Dream’.
https://blog.centrepointalliance.com.au/realiseyourdream/when-is-the-right-time-toretire
General Advice Warning
This information has been provided as general advice. We have not considered your financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication. Whilst all care has been taken in the preparation of this material, it is based on our understanding of current regulatory requirements and laws at the publication date. As these laws are subject to change you should talk to an authorised adviser for the most up-to-date information. No warranty is given in respect of the information provided and accordingly neither nor its related entities, employees, or representatives accepts responsibility for any loss suffered by any person arising from reliance on this information.

 

 

From March 31st 2024, changes to the Victorian WorkCover Laws were introduced. They have been made under the Workplace Injury Rehabilitation and Compensation Amendment to modernise the scheme. This has come about due to the scheme being referred to as “fundamentally broken”. It was no longer meeting the needs of those whom it was originally designed for over 30 years ago.

In 2023/2024 Victorian employers experienced a rise of 42% in their WorkCover Premiums which increased from 1.27% to 1.8%. WorkSafe has announced the rate for 2024/2025 will not see any increases and will remain at 1.8%.

Individual businesses will continue to expect changes to their premium rate as they are based on specific experiences within their respective industry. However, employers who are experiencing a significant increase in their industry could find their premiums increasing by up to 30% in 2024/2025.

 

What changes have been made?

 

Mental Injury Eligibility

Mental Injury claims in comparison to Physical Injury claims have proven to be more expensive. This is due to workers suffering from Mental Injuries generally remain off work for longer periods of time. It’s said by the year 2030, we can expect a third of all claims will be related to mental injuries. In order for WorkSafe to combat these existing challenges, changes in eligibility requirements have been outlined and will apply to any mental injuries sustained on or after 31 March 2024.

A new mental injury definition has been put in place. In order to be eligible for compensation, the following definition must be met. “A mental injury is defined as an injury that causes significant behavioural, cognitive or psychological dysfunction, and has been diagnosed by a medical practitioner in accordance with the Diagnostic Statistical Manual of Mental Disorders.”

Along with the modernisation of the scheme, new exclusions for stress and burnout have been outlined.

 

Ineligible Compensation

Workers will be ineligible to receive compensation if the cause of stress or burnout is one or more of the following:

  • Pressures around an increased workload
  • Working additional hours
  • Interpersonal conflict with co-workers that is not considered bullying or harassment

Typically, the above reasons will be considered as:

  • Usual or typical
  • Reasonably expected to occur in the course of their duties

 

Exemptions to Eligibility

Workers may remain eligible for compensation and an exemption of this rule will apply if they are exposed to situations including:

  • Repeated and unreasonable conflict with people, which is considered bullying and harassment
  • If a worker’s mental injury has been predominantly caused by stress or burnout resulting from traumatic events that are considered usual or typical and reasonably expected to occur in their work

If you are seeking further information on Mental Injury eligibility, download the information sheet here.

 

Second Entitlement Review

 

130 Week – Additional Whole Person Impairment Requirements

Previously, as workers approached their 130 weeks of weekly paid compensation, they would need to review their claim. Reviewing the claim would then determine if payments would be extended past the original 130 weeks. Generally, the final outcome would result in the termination of future payments.

To continue to receive weekly payments once 130 weeks have been exceeded, an additional requirement has been implemented, which includes:

  • Having a whole person impairment (WPI) of 21% or more and
  • Meet the existing capacity test requirement

The WPI requirement will only apply to claims that reached 130 weeks on, or after 31 March 2024. From this date for weekly compensation to continue to be paid post 130 weeks, it must additionally be determined by an independent medical examiner that a worker has a whole person impairment as a result of their injury or injuries from the same event of 21% or more.

For further information on whole-person impairment, download the information sheet here.

 

Further supported changes

 To improve the way the WorkCover scheme operates, a number of supporting changes have also been made and make sure the changes in the Scheme Modernisation Act are effective. These include:

  • Changes to WorkSafe’s ability to share information across business units
  • Requirements for certain rejected claims that can’t be resolved through conciliation to be determined by the courts, instead of arbitration
  • Independent reviews of the changes introduced under the Scheme Modernisation Act to be conducted by a panel of experts in 2027
  • Establishment of the Return to Work Advisory Committee, to provide advice to the WorkSafe Victoria Board on return-to-work initiatives

 The implemented changes are set to deliver a more sustainable scheme to ensure Victorian workers are supported well into the future.

 

If you need assistance with navigating your business through these changes or are seeking any further business advice, contact The Hrkac Group Geelong-based Accounting team. You can make an appointment via email or phone (03) 5224 2366.

 

General Advice Warning
This information has been provided as general advice. We have not considered your financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication. Whilst all care has been taken in the preparation of this material, it is based on our understanding of current regulatory requirements and laws at the publication date. As these laws are subject to change you should talk to an authorised adviser for the most up-to-date information. No warranty is given in respect of the information provided and accordingly, neither nor its related entities, employees, or representatives accepts responsibility for any loss suffered by any person arising from reliance on this information.
Liability limited by a scheme approved under Professional Standards Legislation.

When it comes to preparing and executing a valid Will, several factors need to be taken into account to comply with legal requirements.

A Will is a legal document that sets out individual testamentary wishes. This comes into effect once you have passed away. A Will outlines one’s wishes regarding details on your estate, including who you want to inherit your estate assets. (E.g. specific gifts, family heirlooms, share portfolio, company directorships), as well as your preferred Executor(s).

A Will also outlines other personal matters. This can include who will be granted guardianship for your surviving children. (If under the age of 18 years.)

Often, thinking about writing a Will can be a daunting task and something that can often be put on the back burner. It may have even crossed your mind to attempt writing up a testamentary document yourself. But, despite your best efforts to sign and write a document outlining your final wishes, it may be deemed Informal, or Invalid and entirely dismissed by the courts if it doesn’t constitute an official legal document. As a result, this can cause headaches and a great deal of unnecessary stress for all parties involved.

 

What is an Informal Will?

An Informal Will is a document that is intended to act as a Will but does not comply with the set strict legal requirements. Ultimately, an Informal Will may not be considered valid before the courts when applying for a Grant of Probate. (Known as Letters of Administration with the Will annexed.)

An Informal Will can come in several forms, including:

  • Electronically typed notes; This could be on a computer, tablet, or phone
  • A voice recording or video recording
  • A handwritten note
  • A text message or email
  • Instructions to a solicitor with directives to create or update a Will that was not signed or witnessed before the death

 

What makes a Will invalid?

A Will may be deemed invalid under several circumstances, including but not limited to:

  • Not complying with the requirements of the Wills Act 1997 (Vic)
  • The Will is not signed by the Willmaker
  • The Will is signed without two independent or authorised witnesses present
  • The signature on the Will does not match legitimate examples or is fraudulent
  • The Willmaker did not have the necessary testamentary capacity. (I.e. sound mind) to write a Will (e.g. suffering from a mental illness and/or mental impairments, for example, dementia)
  • The Willmaker is under duress or is influenced by a family member in the writing a new or amending a current Will
  • Not revoking previous Wills

 

Can you prove an Informal Will?

Not all Invalid or Informal Wills are automatically dismissed by the court. The court has discretion to decide whether or not an Informal Will can be valid and be admitted to probate. Each situation is dealt with on a case-by-case basis, and the Will in question will be subject to meeting the legislative requirements of the Administration and Probate Act 1958 (Vic). Providing the Will meets all the pre-requisites, a large amount of evidence will be required to be submitted to court, to support the testamentary wishes of the Willmaker.

Inevitably, this leads to a significant increase in legal costs and delay in administrating the deceased estate. Further, it exposes the family assets to claims from extended family members or former spouses. Being granted probate is an extremely complex process and does not always end in the desired outcome. The desired outcome is finalising and distributing the estate to the desired beneficiaries.

Informal or Invalid Wills can cause significant amounts of stress to all involved, so when the time comes for you to consider making a Will, it is worth investing in a professional lawyer to ensure your final Will meets all legal requirements and is valid.

 

Making a valid Will with The Hrkac Group

Firstly, having a valid Will gives you peace of mind that your estate will be distributed to your intended beneficiaries. In addition, providing your loved ones with legal protection to ensure your wishes are complied with.

You want to be sure that your Will cannot be contested and that it will be considered valid in accordance with the relevant laws.

Our team of professionals can assist you with the following:

  • Drafting & updating Wills (including Wills with trusts)
  • Appointing a financial attorney under an enduring power of attorney
  • Appointing a personal attorney under an enduring power of attorney (formerly known as guardianship)
  • Appointing a medical treatment decision-maker

 

Learn more about Wills & Powers of Attorney here.

 

In conclusion, with careful execution of your Will and attention to your requirements, we can help protect your final wishes.

If you are ready to take that next step and take control of your future, contact our Geelong-based Legal team at The Hrkac Group today.

Make an appointment today via email or phone (03) 5224 2366.

 

General Advice Warning
This information has been provided as general advice. We have not considered your financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication. Whilst all care has been taken in the preparation of this material, it is based on our understanding of current regulatory requirements and laws at the publication date. As these laws are subject to change you should talk to an authorised adviser for the most up-to-date information. No warranty is given in respect of the information provided and accordingly, neither nor its related entities, employees, or representatives accepts responsibility for any loss suffered by any person arising from reliance on this information.
Liability limited by a scheme approved under Professional Standards Legislation.

The Albanese Government recognises the economic realities of 2024: Australians are under pressure right now and deserve tax cuts.

It has been announced that The Albanese Labor Government is delivering a tax cut. This is for every Australian taxpayer to provide targeted cost of living relief, for broader and better” outcomes.

These new tax cuts are designed to provide bigger tax cuts for middle Australia. Set to make a real difference to 13.6 million taxpayers. Mr Albanese states these changes will help with easing the cost of living. All whilst making the system fairer and boosting workforce participation.

“Our plan will more than double the benefit for Australians on the average income. And it will look after low-income earners and part-time workers as well,” Mr Albanese said.

 

From 1 July 2024, the Albanese Labor Government has proposed:

  • Reduce the 19 percent tax rate to 16 percent (for incomes between $18,200 and $45,000).
  • Reduce the 32.5 percent tax rate to 30 percent (for incomes between $45,000 and the new $135,000 threshold).
  • Increase the threshold at which the 37 percent tax rate applies from $120,000 to $135,000.
  • Increase the threshold at which the 45 percent tax rate applies from $180,000 to $190,000.

 

These proposed changes would result in the following:

  • All 13.6 million taxpayers will receive a tax cut – and 2.9 million more taxpayers will receive a tax cut compared to Morrison’s plan.
  • 5 million taxpayers (84 percent of taxpayers) will now receive a bigger tax cut compared to Morrison’s plan
  • 8 million women (90 percent of women taxpayers) will now receive a bigger tax cut compared to Morrison’s plan.
  • A person with an average income of around $73,000 will get a tax cut of $1,504 – that’s $804 more than they were going to receive under Morrison’s plan.
  • A person earning $40,000 will get a tax cut of $654 – compared to nothing under Morrison’s plan.
  • A person earning $100,000 will get a tax cut of $2,179 – $804 more than they would receive under Morrison’s plan.
  • A person earning $200,000 will still get a tax cut, which will be $4,529.
  • The Government will increase the Medicare levy low-income thresholds for 2023-24.

 

Proposed Changes Summarised

2023-24 2024-25
Thresholds ($) Rates (%) Thresholds ($) Rates (%)
0 – 18,200 Tax-free 0 – 18,200 Tax-free
18,201 – 45,000 19 18,201 – 45,000 16
45,001 – 120,000 32.5 45,001 – 135,000 30
120,001 – 180,000 37 135,001 – 190,000 37
Over 180,000 45 Over 190,000 45

 

Geelong Accounting

The proposed changes outlined in this blog will necessitate legislative changes, therefore the implementation of these changes into legislation remains uncertain.

As you prepare for your next tax return, it’s always advisable to consult with a tax accountant or use a reliable tax calculator to understand the changes and accurately estimate your tax obligations. Staying informed about tax policy updates is crucial to ensure compliance.

The expertise and experience of our Geelong Accountants at The Hrkac Group can help you with any tax return enquiries you may have.

To make an appointment to meet with one of our friendly Geelong Accountants, contact us via email or phone (03) 5224 2366.

This information has been provided as general advice. We have not considered your personal or financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication.

Many retirees use their superannuation to commence a pension that pays income at regular intervals. The most common type of pension is an account-based pension. These are also sometimes referred to by their former name – allocated pensions.

Account-based pensions are a very tax-effective way of setting up super to provide a regular flow of income in retirement.

However, like anything to do with super, some hurdles need to be cleared first. This will ensure the efficient and compliant operation of a pension account.

 

Let’s focus on the amount of income that needs to be drawn each financial year.

 

For an account-based pension to receive optimal tax treatment, a minimum amount of income needs to be drawn each year. This is based on a formula that varies with age.

When a pension first commences to be paid, and on 1 July each year thereafter, a percentage factor is applied to the balance of the pension account. The result is the minimum income that needs to be paid from the pension account in the coming year.

 

The following table sets out the current minimum percentages:

 

Age on 1 July

Percentage

Under 65 4%
65 to 74 5%
75 to 79 6%
80 to 84 7%
85 to 89 9%
90 to 94 11%
95 and over 14%

 

In simple terms, a 72-year-old with a pension account balance of $340,000 on 1 July 2023 needs to draw a minimum income of $17,000 in the 2023-24 financial year.

 

The maximum income is not capped, except for pension paid under transition to retirement rules where the pension income is capped at a maximum of 10% of the account balance each year.

If a pension commences part way through a financial year (i.e. other than on 1 July) the minimum income that is required to be drawn is pro-rated for the number of days in the financial year the pension is in force.

 

Taking our earlier example of a 72-year-old, if their pension commenced on 1 September 2023, the minimum income they will need to draw in 2023-24 is $17,000 x 303/365, or $14,112.

 

As a result of the economic turmoil that accompanied the recent global pandemic, the government reduced the minimum income to be drawn from an account-based pension (and certain other types of superannuation income stream) by 50% for the 2019-20, 2020-21, 2021-22 and 2022-23 financial years. Therefore, during these periods, a person aged between 65 and 74 only needed to draw an income of 2½% of their account balance to satisfy the prescribed minimum.

 

For any readers that had taken advantage of the lower minimum income requirement for the past 4 financial years, the discount was discontinued from 1 July 2023. Therefore, if you find you are being paid more income from your account-based pension than you need, it would be a good time to speak with a financial planner and discover the options that may be available to you.

 

By way of example: If you have been receiving income from your pension account of (say) $30,000 and this had been adequate for topping up your income needs, now having to draw an income of $60,000 may be more than needed. One option, particularly for many people under the age of 75, might be to simply re-contribute the excess income back into superannuation as a non-concessional contribution. However, before implementing specific strategies, seek appropriate advice.

 

Retirement Planning Geelong

Meet with The Hrkac Group Geelong-based Financial Planning team and make an appointment. You can book with us via our booking linkemail or phone (03) 5224 2366.

The content within this blog has been sourced from our Licensee, Alliance Wealth’s blog ‘Realise Your Dream’.
https://blog.centrepointalliance.com.au/realiseyourdream/how-much-should-i-draw-from-my-pension
General Advice Warning
This information has been provided as general advice. We have not considered your financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication. Whilst all care has been taken in the preparation of this material, it is based on our understanding of current regulatory requirements and laws at the publication date. As these laws are subject to change you should talk to an authorised adviser for the most up-to-date information. No warranty is given in respect of the information provided and accordingly, neither nor its related entities, employees, or representatives accept responsibility for any loss suffered by any person arising from reliance on this information.

If you have had your current home loan for a number of years, it is likely your needs have since changed. That, or you may be missing out on flexible features or add-ons that have since become available.

Refinancing your home involves paying out your current loan with a new one. In many cases, this will be with a different bank entirely. Why? This may allow you to select certain features that better suit your lifestyle, wants and needs.

 

Here are 8 reasons why you could consider refinancing your home:

 

1. Save on Fees

Your interest rate will have a significant impact on how much you actually pay on your mortgage. If you have had your loan for a number of years, you may be paying loyalty tax. This is when lenders charge long-term customers a higher interest rate, compared to new customers. Securing an interest rate just 0.5% lower than your existing loan can see you save thousands. Ultimately resulting in your loan being paid off quicker, and who doesn’t want those extra dollars in their pocket?

It is important to remember your home loan is more than the interest rate. All lenders measure their rates differently, which is why it is so important to speak with a Lending Specialist or Mortgage Broker to ensure you are reviewing all aspects of the loan before making the change.

 

2. Customise your loan

It is likely that your personal circumstances will change over the course of your home loan and you may need to alter your loan accordingly. When getting your home loan years ago, it may have included features that no longer suit you today, or you have found that over time, the features on your current loan are just not being maximised. Adding or removing features to better suit your lifestyle can help give you the flexibility you need. There are a range of features available to you, including flexible repayments, redraw facilities or even offset accounts. As always, it is best to consult our team of Geelong Mortgage Brokers to explore the best path for you.

 

3. Opt for a fixed rate

Fixed rates work really well in the right situations however upon the end of your fixed rate term, you will be transferred to a higher variable rate by default. However, refinancing your fixed loan once it has ended, may help you avoid having to pay any associated fees with leaving a fixed home loan early.

 

4. Access home equity

If you want to access your home equity, refinancing is the way to do it. Your equity is the portion of your home that you own outright. You can calculate your equity by subtracting your remaining home loan from the balance of your home’s current value. Accessing your equity can then help fund major purchases or investments.

 

5. Investment Opportunities

Refinancing your home can help you maximise your equity on your home. You could then use those funds to invest in real estate, shares, or other opportunities.

 

7. Facilitate Renovations

Enhance your property’s value and move closer to achieving your dream home by undergoing renovations on your property. To avoid having to take out a new loan to fund your renovations and ensure your savings stay in your bank, think about using the equity in your home which can be unlocked by refinancing your home.

 

7. Debt Consolidation

You may have other debts, including personal loans, car loans or credit cards.

Debt consolidation involves combining those other debts with your home loan. This simplifies repayments and makes managing your repayments more convenient.

 

8. Switching Lenders

You may not be 100% satisfied with your current lender. This could be due to a number of factors, some of them being: inadequate website, mobile app or in-person services, inflexible repayment methods or a negative experience with the customer service provided. Whatever the reason, if you do decide to refinance based on the lender, ensure you are taking into consideration all aspects of the new loan and not just the lender.

 

Geelong Mortgage Brokers at The Hrkac Group

If you are considering refinancing your home loan, there are steps you need to take to ensure you are eligible to do so. Our team of Geelong Mortgage Brokers are dedicated to helping you ensure your home loan journey is as simple and stress-free as possible. We have access to a range of home loans offered by banks and non-banking lenders, to ensure we find the best suitable option for you.

Take control of your financial future by meeting with our team of Geelong Mortgage Brokers and home loan specialists at The Hrkac Group. Make an appointment today via our Contact Us page, or phone us on (03) 5224 2366.

General Advice Warning
This information has been provided as general advice. We have not considered your financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication. Whilst all care has been taken in the preparation of this material, it is based on our understanding of current regulatory requirements and laws at the publication date. As these laws are subject to change you should talk to an authorised adviser for the most up-to-date information. No warranty is given in respect of the information provided and accordingly, neither nor its related entities, employees, or representatives accepts responsibility for any loss suffered by any person arising from reliance on this information.

One of the surprising things about superannuation is the lack of engagement people have with it.

It is not until retirement begins to appear on the distant horizon that many start to become more interested in how healthy, or otherwise, their retirement nest egg is looking.

One of the problems that has emerged with super over the years has been the proliferation of individual accounts. It was not uncommon for a person to have several individual accounts. Each time a person changed jobs; a new super fund would be opened. This leads to the duplication of super accounts and with that, the duplication of fees and often, insurance coverage.

However, in recent years the trend for people to have multiple accounts has been trending down. For the most part, has been a good thing.

 

Superannuation Law Requirements

Recent changes to superannuation laws now require employers to look for existing superannuation accounts before simply paying their new employees’ super to their default fund. In addition, superannuation laws specifically require superannuation funds to identify and consolidate multiple superannuation accounts held by their members. This is referred to as intra-fund consolidation.

The Australian Securities and Investment Commission (ASIC) carried out a survey and found that three out of nine trustees of superannuation funds did not have policies in place to identify members with multiple accounts. ASIC is working with super fund trustees to increase compliance in this area. While the idea of consolidating super and eliminating multiple accounts will be desirable, there will be occasions where having more than one superannuation account is either necessary or desirable. Superannuation benefits will generally comprise a taxable component and a tax-free component.

 

Estate Planning

When it comes to estate planning, there may be value in making non-concessional contributions, which form part of the tax-free component. This separates accumulation accounts thereby quarantines them from taxable superannuation benefits.

Often superannuation fund membership will include life and total and permanent disablement insurance cover. And, in many instances, this cover has been included without the need for the member to meet any medical requirements.

Therefore, for a superannuation fund member that has multiple superannuation accounts with embedded life insurance cover, and their health makes it unlikely they can obtain insurance either at all, or at an affordable price if they were medically underwritten, holding more than one superannuation account with life insurance attached can be a bonus.

There will be situations when consolidating superannuation accounts cannot be done. Alternatively by doing so would not be in a member’s best interest.

The obligations imposed on superannuation funds to consolidate their members’ multiple accounts into a single superannuation account may be contrary to some of the strategies that have been specifically structured to obtain a particular outcome. With that in mind, it is important to pay attention to any correspondence you receive from your superannuation fund. Remember reinstating a former situation, particularly if intra-fund consolidation has occurred, may be difficult and very time-consuming.

 

Expert financial advice with The Hrkac Group

Having a financial planner on your team can be worth its weight in gold when navigating the complexities of superannuation. Plan a meeting with our Geelong-based Financial Planning team. Make an appointment today via our booking linkemail or phone (03) 5224 2366

 

The content within this blog has been sourced from our Licensee, Alliance Wealth’s blog ‘Realise Your Dream’.
General Advice Warning
This information has been provided as general advice. We have not considered your financial circumstances, needs, or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication. Whilst all care has been taken in the preparation of this material, it is based on our understanding of current regulatory requirements and laws at the publication date. As these laws are subject to change you should talk to an authorised adviser for the most up-to-date information. No warranty is given in respect of the information provided and accordingly neither nor its related entities, employees, or representatives accepts responsibility for any loss suffered by any person arising from reliance on this information.

A recent review of the Privacy Act Exemption in Australia has brought forth a pivotal change. This will impact small businesses with an annual turnover of $3 million or less. In this article, let’s explore the reasons behind this shift. We’ll delve into the significant proposals made by the review, and discuss the implications of these changes for small businesses. We’ll also look at the steps the government plans to take to ensure a smooth transition while safeguarding individuals’ privacy.

 

A Changing Landscape of Privacy:

The digital age has ushered in a new era of data privacy concerns. Personal information is more vulnerable than ever. To misuse and data breaches, making the protection of this data of paramount concern. The Privacy Act in Australia plays a crucial role in safeguarding individuals’ privacy, but its application hasn’t been consistent. Small businesses, with annual turnovers of $3 million or less, have been exempt from certain privacy obligations. This is set to change.

 

Proposals from the Privacy Act Review:

The Privacy Act review has proposed several key changes aimed at strengthening data privacy. These proposals have gained the government’s support, marking a significant shift in the country’s privacy regulations. The proposed changes include giving individuals greater control over their privacy. This is done by ensuring entities seek informed consent regarding the handling of their personal information. Additionally, entities will be held accountable for the way they handle individuals’ information. With enhanced requirements for information security and destruction of data when it’s no longer needed. Moreover, the review seeks to simplify obligations for entities handling personal information on behalf of others and introduces the idea of a Children’s Online Privacy Code to provide stronger protections for children online.

 

Removal of the Small Business Exemption:

One of the most substantial proposals from the Privacy Act review is the removal of the small business exemption. This exemption had previously spared small businesses with annual turnovers of $3 million or less from certain privacy obligations. However, the review committee found that community expectations around privacy had evolved, and they fully expected their personal information to be safeguarded. The removal of this exemption is a clear reflection of the changing landscape of data privacy, but it comes with a caveat. The government has acknowledged that further consultation with small businesses and their representatives is necessary to understand the full impact of this change.

 

Implications for Small Businesses:

The removal of the small business exemption carries significant implications for small businesses across the nation. They will now need to adapt to a new set of regulatory requirements, which could prove challenging. Non-compliance with these new regulations could result in penalties, fines, and reputational damage. Therefore, small businesses must not only understand these changes but also put in place strategies to adhere to the Privacy Act and protect customer data.

 

Ensuring Compliance and Data Protection:

Small businesses can prepare for the changes by conducting a privacy impact analysis and data audit. These assessments will help in understanding the extent of data handling and its potential vulnerabilities within the organisation. Implementing robust data protection policies and practices will be key to ensuring compliance with the evolving regulations. These policies should cover data security, access control, encryption, and procedures for data destruction when it is no longer required.

  

Government’s Commitment to Privacy:

The government has demonstrated a strong commitment to ensuring data privacy in the digital age. This commitment is not new; it builds upon past actions. In the previous year, the government significantly increased penalties for privacy breaches and empowered the Australian Information Commissioner with greater authority to address such breaches. In response to the changes brought about by the Privacy Act review, the government will conduct an impact analysis. The government is also set to collaborate with community members, businesses, media organisations, and government agencies to develop legislation and guidance material that aligns with the new privacy landscape.

  

The Expectations of Australians:

Australians are increasingly reliant on digital technologies in various aspects of their lives. Whether it’s for work, education, healthcare, or everyday commercial transactions, the digital realm plays a crucial role. In this context, when Australians are asked to share their data, they rightfully expect that it will be handled and protected with the utmost care and security.

 

The removal of the small business exemption from the Privacy Act signifies a significant transformation in Australia’s data privacy and protection approach. While it may pose challenges for small businesses, it is crucial for ensuring individuals’ privacy and building trust in a digital age. The government’s commitment to working with small businesses and other stakeholders is a positive step toward a smooth transition. As the digital landscape continues to evolve, small businesses need to adapt, prioritise data protection, and honour the trust that customers place in them. This change is a reminder that data privacy is a shared responsibility. All entities, regardless of size, must play their part in safeguarding personal information.

 

Geelong Accountants

If you’re interested in knowing more about your obligations as a small business, speak to the expert Geelong accountants at The Hrkac Group. Non-compliance with these new regulations carries the risk of penalties. Small businesses need to understand these changes and put strategies in place to adhere to the Privacy Act and protect customer data. Contact our experienced team of Geelong accountants if you need help implementing data protection policies and practices to ensure compliance with the evolving regulations.

To make an appointment with one of our friendly Geelong accountants today, contact us via email or phone (03) 5224 2366.

The dream of owning a home is deeply ingrained in Australian culture. For many, it represents a significant milestone in their lives, symbolising financial security and stability. But, the rising cost of housing in many parts of Australia has made this aspiration increasingly challenging for first-time buyers.

Furthermore, the dream of owning a home has been made even more difficult due to stricter lending practices by banks, sluggish wage growth relative to inflation, and concerns about fluctuating interest rates. In response to this challenge, commencing on July 1st, 2023, the government’s Home Guarantee Scheme expanded its eligibility criteria. It has been made to be more accessible for individuals who have long aspired to homeownership.

 

Understanding the First Home Guarantee Scheme

The First Home Guarantee is an Australian Government initiative. It’s aimed at speeding up the ability to buy a home for eligible buyers. The Scheme comprises several key components, each aimed at assisting first-time buyers in different ways:

  1. First Home Guarantee

This component of the Scheme helps eligible first-home buyers secure a home loan with a lower deposit. Typically, banks require a deposit of at least 20% of the property’s value. Under the scheme, eligible buyers can purchase a home with as little as a 5% deposit. The government guarantees the remaining portion of the deposit, effectively eliminating the need for costly Lenders Mortgage Insurance (LMI). This makes homeownership more attainable for those who may have been struggling to save a large deposit.

Beginning on July 1, the upcoming changes will extend eligibility beyond singles and de-facto couples. Now encompasses family members, siblings, and friends who can collaboratively apply and divide the expenses associated with a first home deposit.

  1. Regional First Home Buyer Guarantee

This program is for eligible first-home buyers looking to purchase their first home in a regional area. It enables them to do so with a deposit as low as 5%, without incurring the expenses associated with LMI.

On July 1, the upcoming changes will extend eligibility beyond singles and de-facto couples to encompass family members, siblings, and friends who can collaboratively apply and divide the expenses associated with a first home deposit.

  1. Family Home Guarantee

This initiative offers eligible single parents with dependents the opportunity to apply for a mortgage with as little as a 2% deposit, without attracting LMI, thanks to the government acting as guarantor. It’s accessible to both first-time homebuyers and single parents seeking to enter or re-enter the property market, whether they intend to purchase an existing property or build a new home. This scheme is intended to help alleviate some of the financial stress that often accompanies single parenthood.

Starting from July 1, the forthcoming changes will broaden eligibility criteria to encompass not only single parents but also single legal guardians of children, including siblings, aunts, uncles, and grandparents.

 

Who’s Eligible to Apply?

 To apply for the Scheme, following the changes that took effect on July 1, prospective homebuyers must meet the following criteria:

  • Citizenship or Residency: Applicants must be Australian citizens or permanent residents at the time they enter into the loan. Commencing July 1, permanent residents will now be eligible for all three guarantees offered under the scheme.
  • Age Requirement: Homebuyers must be at least 18 years of age to be eligible.
  • Income Limits: The income threshold for eligibility is an annual income of up to $125,000 for individuals or $200,000 for couples, as indicated on their Notice of Assessment issued by the Australian Taxation Office.
  • Deposit: A minimum deposit of 5% of the property’s value is required. However, for those applying for the Family Home Guarantee, a minimum deposit of 2% is sufficient.
  • Owner-Occupancy: Applicants must intend to use the purchased property as their primary residence, establishing them as owner-occupiers.
  • First Homebuyer Status: Eligibility extends to first-time homebuyers who have not previously owned or held an interest in a property in Australia. Additionally, homebuyers who have not owned a property in the past 10 years are eligible under the scheme.
  • Loan Approval: Applicants should be capable of securing a loan through a participating lender.

 

What Type of Property can be Bought?

In order for a property to qualify for eligibility, it must meet the criteria of being categorised as a ‘residential property’. Residential properties that meet the eligibility criteria encompass the following:

  • An existing house, townhouse, or apartment
  • A house and land package
  • Land and a separate contract to build a home
  • An off-the-plan apartment or townhouse

The program aids in acquiring or constructing a modest home, with the condition that the residential property’s value does not surpass the applicable price cap for its location. The specific price caps for capital cities, major regional centres, and regional areas can be referenced here.

 

Key Considerations when Financing Your New Home

When it comes to financing your new home, it’s essential to temper your excitement with thoughtful consideration and careful decision-making. Owning a home is a significant step. It demands thorough research and prudent choices that can profoundly impact your future as a homeowner. Several key considerations should include:

  1. Type of Home

Begin by defining the type of home you’re seeking. Are you in pursuit of your dream home, or is an entry-level home more aligned with your current goals? Consider your family’s needs, the required space, and whether the home should accommodate future growth. Additionally, assess if the neighbourhood matches your lifestyle preferences and necessities.

  1. Financial Assessment

Evaluate your financial situation. Determine the amount you can save for a deposit, as a larger deposit can reduce long-term interest costs on your loan. Ensure your income and financial stability align with your new home purchase and think about whether you’ll be able to consistently service your mortgage. Explore potential government initiatives or subsidies for which you may be eligible.

  1. Home Loan Considerations

Delve into the specifics of your home loan. Have you consulted with a mortgage broker to explore various loan options? Understand whether you’ll be subject to paying LMI and assess whether a fixed or variable interest rate is more suitable for your circumstances. Additionally, consider whether you’ll secure your home loan through a traditional bank or an alternative lender.

 

Mortgage Brokers Geelong

By taking these factors into account and speaking with our expert mortgage brokers in Geelong, we can help you confidently finance your new home and set a solid foundation for your homeownership journey.

The expert lenders at The Hrkac Group are committed to helping borrowers get the most from their lending. Our team of financial experts can help you create a financial plan that works for you and your individual circumstances and can help you make the right decision about managing your home loan. If you want to discuss your options, speak to an expert Geelong Mortgage Broker at The Hrkac Group.

Our Geelong Mortgage Brokers’ expertise and experience in facilitating your home loan can help ensure a positive experience for you. To make an appointment to meet one of our friendly Geelong Mortgage Brokers, feel free to contact us via email or phone (03) 5221 2355.

The information provided in this blog is of a general nature only and is not intended as either advice or recommendations and is not tailored to your specific circumstances. Please also note that this does include any information on any Payroll requirements imposed by any State or Territory Governments outside of the State of Victoria. Please contact our partner – SIBS Bookkeeping team or us – the Hrkac Group Accountants team – if you would assistance as to how, or if, any of the abovementioned would apply to you.
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Whether consciously acknowledged or not, trade marks are an integral part of everyone’s daily interactions. The term trade mark essentially means brand. As customers engage with your business, your brand serves as their primary point of contact and their purchasing decisions are influenced by the reputation the brand represents. So, it is essential you protect your brand and the value that lies with it.

 

Why Bother with a Trade Mark?

A trade mark is a type of intellectual property. It can be a word, a phrase, an image, or even a combination that makes your business unique. Think of them as your brand’s superhero cape, granting you the power to stand out in the competitive marketplace.

Registering a trade mark provides peace of mind for your brand. IP Australia has stated that businesses with registered trade marks are 13% more likely to experience growth. Why? Because trade marks influence how people buy. Your brand isn’t just a logo, it’s a promise of quality, trust, and uniqueness.

Think of Apple – that half-eaten fruit is more than just a logo, it’s a symbol of innovation and style. Trade marks transform your brand into a legend that customers recognize and trust, whether they’re scrolling through Instagram or wandering the aisles of a store.

 

Legal Reasons to Trade Mark

  1. Exclusive Use
    A trade mark legally protects your business’s unique brand, products of services. When you register a trade mark, you secure the exclusive right to use that particular mark for specific goods and services. This means you have the authority to take legal action against any unauthorised use of your trade mark by others and to seek compensation for any damages your business may have incurred due to the misuse of your trade mark.Imagine someone employing your business logo to promote their own inferior products or services. Such actions could potentially mislead your customers into believing they are engaging with your offerings. This has the potential to tarnish your reputation. Opting not to register your trade mark means you have no legal recourse in this instance.
  2. Authorising Use
    Another legal benefit derived from registering a trade mark lies in your ability to create licenses for its usage. A trade mark license allows you to charge third parties for utilising your trade mark. This presents a valuable avenue for diversifying your revenue streams while simultaneously expanding the reach of your brand.
  3. Avoid Infringing a Competitors Trade Mark
    Engaging in thorough research and pursuing your own trade mark registration is a strategic move to shield your brand and business from inadvertently using another entity’s trade mark. This proactive step is paramount, considering that IP Australia’s findings indicate a staggering 48% of small businesses encounter the need for rebranding due to contested trade mark infringements.Further a survey of global brands found that 75% of trade mark infringements violations lead to complex and expensive legal proceedings that, on average, resulted in costs of $100,000. So, it can be costly mistake to not trade mark your business.

 

To Trade Mark or Not

Surprisingly, the number of small businesses in Australia with registered trade marks remains below 4%, according to IP Australia. Businesses opting not to register a trade mark may be missing out on numerous benefits not limited to those mentioned here.

  1. An Asset
    Trade marks embody a form of property akin to real estate. A trade mark isn’t just a logo, it’s an asset. As your business grows, so does the value of your trade mark. Additionally, as you own it, you can sell it. They are capable of being acquired, sold, licensed, or even employed as collateral to secure loans for business expansion.
  2. Easy to Differentiate
    The marketplace landscape is often saturated, making it challenging to set your business apart from competitors. Trade marks and brands function as potent communication tools that capture customer attention and differentiate your business, products, and services.

Upon encountering a trade mark, customers swiftly discern your identity, the reputation associated with your business, and are inclined to explore alternatives less frequently. Your brand could essentially serve as the pivotal factor influencing a customer’s purchasing decision, emphasising the pivotal role trade marks play in shaping consumer choices.

  1. Building a Dream Team
    Brands with strong trade marks have the ability of attracting and keeping top-notch talent because employees naturally gravitate towards brands they respect and feel a connection with. Your brand’s trade mark isn’t just a logo, it’s a cheerleader for your team. If it can bring out positive feelings and attachment to the brand, it makes your business a more appealing place to work over competitors.

Research from IP Australia shows that small businesses that register for trade marks are 16% more likely to enjoy strong employment growth. What’s more, small businesses owning trade marks also hire around 3.5 times as many employees as their non-trade mark peers. They also pay a better median wage. Building a strong workforce and growing your business is all in the power of owning your brand’s mark.

  1. Don’t Expire
    Lastly, trade marks never expire so long as you continue to pay the renewal fees every 10 years in Australia. So, you have nothing to lose other than protecting your business and brand by registering a trade mark.

Understanding why trade marks are valuable assets and how they contribute to growth is crucial for businesses. Trade mark registration entails more than a superficial logo. It encapsulates a business’s core, its values, and its distinct promise to consumers. Armed with this comprehension, enterprises can unlock the full potential of trade marks, surging ahead in the competitive arena while establishing a recognisable and legally protected niche.

 

Lawyer Geelong

 If you require assistance of have any further questions about registering a trade mark, our experienced lawyers can assist you and answer any questions you may have.

The expertise and experience of our Geelong Lawyer team at The Hrkac Group can help you regarding registering a trade mark for your business. If you need assistance or advice, please get in touch. To make an appointment to meet with one of our friendly Geelong Lawyers,  contact us via email, or phone (03) 5224 2366.

 

Liability limited by a scheme approved under Professional Standards Legislation.

In the realm of personal finance, the term “credit score” often comes up, though many are unsure of its significance. Credit scores often serve as a crucial component in the decision-making process of potential lenders and creditors. While credit scores are not the sole determinants of your financial fate, they provide a general assessment of your suitability for a loan.

In this comprehensive guide, we explore the ranges of credit scores, shed light on a lender’s perspective, examine the factors that impact credit scores, and offer actionable strategies to cultivate responsible credit behaviour. By understanding the nuances of credit scores and proactively managing your financial health, you can unlock opportunities for better loan terms and financial well-being.

 

What is a credit score?

A credit score is a three-digit number ranging from 300 to 850. Credit scores are calculated using information in your credit report, including your payment history, the amount of debt you have, and the length of your credit history.

There are many different scoring models, and some use additional data in their calculations. Credit scores are used by potential lenders and creditors, such as banks, credit card companies, or car dealerships, as one factor when deciding whether to offer you credit, like a loan or credit card. It helps them determine how likely you are to pay back the money they lend.

 

 So what is a good credit score?

When it comes to credit scores, it’s important to understand that everyone’s financial and credit situation is unique, and there is no “magic number” that guarantees better loan rates and terms. However, credit scores can provide a general assessment of your creditworthiness.

Here are the typical credit score ranges:

  • Fair Credit: Scores ranging from 580 to 669 are considered fair.
  • Good Credit: Scores between 670 and 739 fall into the good credit range.
  • Very Good Credit: Scores from 740 to 799 are categorized as very good credit.
  • Excellent Credit: Scores of 800 and above are considered excellent.

Lenders tend to categorise borrowers based on their credit scores to assess risk and determine loan terms.

Here’s how lenders generally view borrowers based on credit scores:

  • Acceptable or Lower-Risk Borrowers: Individuals with credit scores of 670 and above are seen as acceptable or lower-risk borrowers. They are more likely to qualify for favourable loan terms and credit opportunities.
  • Subprime Borrowers: Those with credit scores ranging from 580 to 669 fall into the category of subprime borrowers. They may face challenges in qualifying for better loan terms due to their credit score, as lenders consider them to be at a higher risk compared to those with higher scores.
  • Poor Credit Range: Borrowers with credit scores below 580 generally fall into the poor credit range. They may encounter difficulties in obtaining credit or qualifying for better loan terms, as lenders perceive them to be high-risk borrowers.

Different lenders have different criteria when it comes to granting credit, which may include information such as your income or other factors. That means the credit scores they accept may vary depending on that criteria.

Credit scores may differ between the three major credit bureaus (Equifax, Experian, and TransUnion) as not all creditors and lenders report to all three. Many creditors do report to all three, but you may have an account with a creditor that only reports to one, two, or none at all. In addition, there are many different scoring models available, and those scoring models may differ depending on the type of loan and lenders’ preference for certain criteria.

 

What Factors Impact Your Credit Score?

Here are some tried and true behaviours to keep top of mind as you begin to establish – or maintain – responsible credit behaviours:

  1. Pay your bills on time, every time. This doesn’t just include credit cards – late or missed payments on other accounts, such as cell phones, may be reported to the credit bureaus, which may impact your credit scores. If you’re having trouble paying a bill, contact the lender immediately. Don’t skip payments, even if you’re disputing a bill.
  2. Pay off your debts as quickly as you can. By reducing your overall debt load, you can improve your credit utilisation ratio, which is the amount of credit you’re using compared to your total available credit. A lower credit utilisation ratio can positively impact your credit score.
  3. Keep your credit card balance well below the limit. A higher balance compared to your credit limit may impact your credit score. Aim to keep your credit utilisation ratio below 30% to maintain a good credit score.
  4. Apply for credit sparingly. Applying for multiple credit accounts within a short time period may impact your credit score. Each application typically results in a hard inquiry on your credit report, which can temporarily lower your credit score. Only apply for credit when you truly need it and can responsibly manage additional credit accounts.
  5. Check your credit reports regularly. Request a free copy of your credit report and check it to make sure your personal information is correct and there is no inaccurate or incomplete account information. You’re entitled to a free copy of your credit reports every 12 months from each of the three nationwide credit bureaus by visiting www.annualcreditreport.com. By requesting a copy from one every four months, you can keep an eye on your reports year-round. Remember: checking your own credit report or credit score won’t affect your credit scores.
  6. Dispute inaccuracies. If you find information you believe is inaccurate or incomplete, contact the lender or creditor. You can also file a dispute with the credit bureau that furnished the report. At Equifax, you can create a myEquifax account to file a dispute. Visit our dispute page to learn other ways you can submit a dispute.

A good credit score is crucial for accessing favourable credit terms and opportunities. It represents your creditworthiness and the likelihood of paying back borrowed money. By understanding how credit scores are calculated and practicing responsible credit behaviours, you can work towards achieving and maintaining a good credit score, which opens up doors to better financial opportunities. Remember, building good credit takes time and discipline, but the effort is well worth it in the long run.

 

Mortgage Broker Geelong

As you prepare to take the leap into home ownership, it’s important to consult with a Mortgage Broker to understand your obligations.

The expertise and experience of our Geelong Mortgage Broker team at The Hrkac Group can help you with securing a home loan. If you need assistance or advice, please get in touch. To make an appointment to meet with one of our friendly Geelong Mortgage Brokers, contact us via email, or phone (03) 5224 2366.

 

Liability limited by a scheme approved under Professional Standards Legislation.