So how far will interest rates rise and what should you do?

Matthew Dawe Mortgage Broker & Financial Adviser here, and I'm going to give you my thoughts and solutions.

Fixed Interest rates have gone from 2.19% in July last year to 6% today. I simply believe that interest rates need to be above the inflation rate to have the desired affect. Inflation is currently above 7%. You are getting constant revisions of fixed interest rates upwards and I think there is more to come.

So should you break your existing fixed interest rate and lock in a new interest rate? Quite often its not worth it, because you are going to lose your much lower interest rate. A quick example is: say your on a 4% fixed interest rate and you have got 1 year to go, Current rates are 6%, so your going to 'lose' 2% over the next year, you are going to have to try and make that up. So retail fixed interest rates would have to go to 8% for you to break even on that proposal.

Do you have a monthly or fortnightly budget of income and expenses? Lax spending habits are the biggest problem I see with proposals. They jeapordise your long term wealth and they put pressure on you because your unable to save a buffer in uncertain times.

So when your ready there are 3 ways we can help you, you can like us on our Facebook page, I'm offering free strategy sessions consultations where you can discuss your situation and talk about next steps, or if you know someone who would benefit from this video, help them out and please forward this video to them, look forward to talking.

Matthew Dawe

Mortgage Broker | Financial Adviser

Phone: 027 321 4287

Email: mortgages@matthewdawe.com

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