1st street Blog

Why Life Insurance is a NON-NEGOTIABLE - 06/02/2018

Life Insurance Case Study

Scenario:

Joe, mid 40’s is a father, husband and primary breadwinner for his family. His wife Jane, works part time to allow her to be able to look after the home and 2 kids. Both living a healthy active lifestyle and live on the lower north shore. They have a mortgage in the high 800’s and recently purchased a new car and paid school fees for a further 6 years.

After having some abdominal pain, Joe consulted his doctor who scheduled a routing exam.

Unfortunately,  this identified a large growth in his intestine. After taking a biopsy it was discovered to be a highly aggressive tumour and had already metastasised and spread to  other organs. His prognosis was only a number of months.

Outcome:

Luckily Joe had the foresight to put in place a suitable insurance portfolio and had it not been for this, Jane would not be able to afford to pay her mortgage. She would likely have had to sell her home and look for work to provide for the family. She would have had to reconsider where her children go to school and certainly change her lifestyle.

Joe’s life insurance policy provided a benefit that was able to pay down the mortgage to a manageable level. Jane was able to set aside enough funds to provide for their kids’ education and she will continue to receive a supplementary payment on a regular basis to provide for their day to day living needs.

Why is it a non-negotiable?

The figures are in, and only 11% of mortgage holders aged 20-49 have any form of loan protection should their income suddenly cease due to illness, injury or death. This raises the question: is a lack of information or fear of unaffordability contributing to a low level of life insurance around Australia?

So what is life insurance and what are the benefits?

  • Life insurance provides the security of covering your home loan and other ongoing costs if the unfortunate were to happen. It ensures your family and loved ones aren’t left with the burden of having to repay your mortgage in the event of death and provides peace of mind and protection of your financial obligations.
  • Life insurance can be held personally or within superannuation funds. The benefit inside super is it assists with managing cash flow and your super fund can pay the premiums.
  • Policies are more cost effective than most people think and can be structured in different ways depending on your situation
  • Once a policy is accepted you can be covered until age 99 as long as you pay the premiums and there is no need to report future medical events to the insurer.
  • Cover can be automatically increased each year to keep up with inflation and also at key events such as birth of a child, new mortgage, etc.

What about cost?

Perhaps the greatest concern for individuals when contemplating life insurance is knowing how much it will cost. The price you pay for a life insurance policy depends on a number of factors including:

  • The level of cover (should be at least the total of your mortgage)
  • Your age, health and lifestyle status
  • Generally, the younger you are, the cheaper your policy premiums are likely to be and often you’ll be able to find a policy that offers very good value for your needs

There are many things an average household can live without, but for those who have a mortgage or those considering purchasing their first property, life insurance is certainly not one of them. You never know when the unthinkable may happen. Be proactive in protecting your family – take the time to talk to a mortgage broker about your best options and they can point you in the right direction to find a qualified financial planner.

 

 

2018 Predictions from 1st Street Financial - 06/02/2018

The new year is already in full swing and if you’re looking to get active in the property market this year, it’s important to know what to expect. Whether you’re a first time buyer or a seasoned property investor, knowing what’s ahead is key to making sure you find the right property fit.

Property prices will remain fairly steady

Towards the end of 2017, the Sydney house market began to slow and plateau. This was partly explained by APRA’s tightening on investor borrowing and interest-only loans which resulted in higher interest rates for those borrowers, lowering the overall demand for housing.  After speaking with many agents, the understanding is that the heat has come out of the market for now. Stock levels of property are at the lower end (especially in the most desirable suburbs) so this is helping the market remain steady. And whilst this continues, buyers are outnumbering sellers, heightening the activity of eager buyers. It is expected that buyer numbers will remain buoyant and achieve strong purchase results while the market is in its current moderate state.

In other Eastern states, we expect to see Victoria experiencing fairly steady market fluctuations. There is still more affordable housing in Melbourne and surrounds than in Sydney and the strong first home owners buyers market throughout 2017 is likely to continue this year. On the other hand, Queensland has the capacity to rise slightly in the next year. Housing affordability and a stable market have resulted in a steady growth in population which in turn is growing the property market. Last year saw a slow but steady rise and it is predicted that this will continue in the upcoming year.

Interest rates are unlikely to change significantly

Despite projections from numerous economists that the RBA will increase rates up in 2018,there should be  little to no change in interest rates this coming year. Factors such as low growth in global wages and inflation as well as continued weak consumer spending due to household incomes under pressure, will provide conditions to retain interest rates at 1.5 per cent.

When looking at longer term fixed rates (3-5 years fixed) and using those rates as an indication to predict broader interest rate patterns, it suggests to that rates over the coming year or two will remain fairly steady, with the minimal chance of a slight increase late this year.

12 Ways to Enjoy Summer Without Spending a Fortune - 06/12/2017

If you’re wondering how you’ll make ends meet this silly season, check out these tips on how to spend, without spending every cent.

Summer in Australia can often be one of the busiest times of year with end-of-year work parties, Christmas, family gatherings, mini holiday breaks, not to mention New Year’s Eve and New Year’s Day.

If you’ve been saving for something big or are just cringing at the thought of how you’ll make ends meet over the holiday period, don’t freak out yet. There are plenty of ways you can still have fun without spending all your savings or racking up serious debt on your credit card.

How to take on summer without spending a fortune

1. Write down your Santa list

There may only be a couple of weeks left until Christmas, but if you’ve still got things to buy, making a list, setting a budget and sticking to it could go a long way to ensure you don’t overspend or rack up additional debt. After all, Australians are due to spend over $9.7 billion on Christmas presents this year, which is up 28% on last year.i

2. Diarise your upcoming events

Knowing what’s happening and how much you’re likely to fork out will help you to manage your cash and allocate what you need for each occasion.

3. Take turns entertaining at home

This can significantly reduce the money you and your mates spend on eating out, particularly if everyone is happy to bring their favourite signature dish, juice of choice or fruit sorbet when temperatures are running high.

4. Make the most of the warm weather

Hit the beach, head to the local playground, or pack a picnic basket and enjoy a barbecue at a nearby park. It won’t involve entry fees and depending where you go, you could load up the fishing rods or even a footy for a friendly game.

5. Take an esky

You’ll save a fortune on food and cold drinks no matter what’s on the agenda.

6. Look out for meal and beverage specials

There are plenty of places where you can find two-for-one offers and other great deals. Websites like TheHappiestHour can give you some ideas and you may even find some new alfresco venues you haven’t been to along the way.

7. Travel smart

Carpool, get a lift, catch public transport, or ride a bike. Too many Taxis and Ubers can drain funds, particularly if you’re not keeping a record of how often you use them.

8. Cut accommodation costs

Bunk with mates, house-sit, swap accommodation, volunteer your skills for a place to stay, or have a staycation where you check out attractions close to home.

9. Search for holiday deals online

Look at comparison websites for flights, accommodation and transport. Doing your homework can often mean more spending money in your pocket.

10. Stick to using cash as much as possible

When you pay in cash, there’s no risk of you having to pay added interest charges. Plus, leaving your cards at home means you’re less likely to go over your budget as you can’t say—I’ll just take out another $100.

11. Trade with friends

If you’ve got more outings than outfits lined up, rather than hit the shops, borrow something from a mate. It doesn’t have to stop with clothes either. You could exchange homes for the week, swap movies, or trade sporting gear like bikes and fishing rods.

12. Research free events

Look up what’s on in your local area. There are often a variety of things happening over summer, such as food and wine festivals, street fairs and markets.

Whatever your agenda over the holidays, it’s important to have a realistic plan when it comes to your money. Give yourself some room for movement and still aim to avoid that financial hangover.

https://www.finder.com.au/press-release-nov-2016-record-xmas-aussies-to-spend-10-billion-on-gifts

These Tips Will Save You $100’s On Your Holiday Shopping - 05/12/2017

The holiday season is the most fun time of year, but many are left paying the bills for months afterwards. Figures reveal that Aussies spend around $1000 each at this time of year, with the average credit card debt coming in at over $1,600! So if you’re trying to minimise your spending, here are some clever ways you can save $100’s on your holiday shopping.

Make a list & think before you buy

Create a list of everyone you need to buy for and brainstorm some gift ideas for each person (be thoughtful and really think about what they’d love to receive). This way you’ll know exactly what you’re shopping for and won’t get distracted with other purchases. Once you’ve found the items you’re after, pause and think about them for 24 hours before you make the purchase. This will avoid any impulse buying.

Set a budget & always pay in cash

Set yourself a realistic budget based on what you have in your savings and always pay in cash. This will ensure you’re not spending money you don’t actually have. Don’t forget to factor in all expenses like gifts, gift wrap, cards, food and drinks.

Collect gifts throughout the year

If you see a great gift (at a bargain price) earlier in the year, grab it and save it for later. Having a gift cupboard to store future gifts is always handy so you’re not waiting until the last minute to do your entire holiday shop.

Shop at outlets or markets

Outlet stores usually tend to offer products at lower prices so do a trip to your local outlet centre to get the bulk of your shopping done. Markets are also great to find some quirky and cheap gifts.

Only order online with free shipping

With so many online stores available, only shop on those that offer free shipping. Most online sites will offer free shipping if you order over a certain amount, so try to combine your purchases wherever possible.

Use after-pay smartly

If you’re going to opt for a buy now, pay later service like after-pay, make sure you’re still sticking to your overall budget and can actually afford to spend that money. After-pay can be great if used smartly – you’ll be set up with an automated payment framework, whilst avoiding any interest fees.

Buy experiences

Many of us are drowning in too much ‘stuff’. So why not give an ‘experience’ instead? Deal websites like Luxury Escapes and Scoopon offer everything from holidays to spa vouchers to kids entertainment options and you can usually snag a bargain. Giving experiences means you can also bundle your gifts and give an experience to the whole family, rather than multiple smaller individual gifts.

Gift exchange

Suggest doing a ‘Secret Santa’ style gifting within your family. This way you’ll be able to purchase one high quality gift for someone, rather than many smaller ‘cheaper’ presents.

Split your gifts with others

Join forces (and wallets!) with your family members or friends and buy combined pressies for others. Try teaming up with your siblings to buy for your parents – it’ll be a huge cost saver!

BYO dish

Food can totally break the bank! So if you’re hosting this year’s celebratory event, ask all your guests to bring a dish each (be sure to allocate who’s bringing what so there’s no double ups).

Buy in bulk

This is always worth doing for things like wine, which you can give away as gifts or use for events you are hosting. Most places offer discounts if you buy two or more bottles, but generally it’s always more economical to buy wine by the case.

10 Tips For Keeping Your Home Safe While On Holidays - 05/12/2017

Whether you’re jetting off to a luxurious beach resort, or simply going on a roadtrip to visit family, holidays are a chance to escape the daily stressors.

However, to avoid unnecessary worry or coming home to find it’s been broken into, take these simple precautions to keep your home safe and give you peace of mind this holiday season.

Consider hiring a house sitter or pet sitter

The best way to protect your home while you’re away is to have someone you trust live in it. It can be as simple as asking a family member to move in. Otherwise there are services you can use for house and pet sitting to ensure your plants get watered and your pets get cared for.

Pause your mail

Call your local post office to stop your mail delivery and hold your mail until you get back. The same goes for your weekly newspaper delivery. Otherwise you can always ask your friendly neighbour to collect it regularly for you!

Make your home look lived in

Have some lights set on timers so they automatically switch on for a period of time each evening. Put the TV on a timer too (or even the radio) so there’s some noise coming from your property each day. You can even hang some washing on the line so it gives the impression that you’re still home.

Maintain your garden

Whether that means hiring someone to mow your lawn once a week, or kindly asking a friend to give it a quick trim, having an overgrown and neglected lawn is a tell-tale sign that you’re not around.

Lock up properly

This one might seem obvious, but it can be easy to forget when you’re rushing around doing last minute planning and packing. Be sure to lock every gate, window and door (deadlock if possible). If you don’t make it easy for burglars, they’ll be less inclined to break in and try the next unoccupied house in the neighbourhood.

Beware of social media

Sure, you’re excited about your holiday, but don’t post the news for the whole world to see! It’s easy to forget that whilst we think we are connecting only with friends on Facebook and Instagram, most of what we say is public and all too easy for people to take advantage of.

Install some added security

Setting up a home security system or even just exterior timer lights is a good way to ramp up the security and fend off any potential threats. Be sure to alert you security company when you’re going away too. That way you can leave knowing you’ve got an extra eye monitoring the place.

Leave curtains how they usually are

Which is safer – curtains closed or open? The bottom line is noticeable changes could hint that you’re not around anymore, so leave your curtains exactly as you usually keep them when you’re home. If that means they’re open, move any expensive items (jewellery, computers etc.) that are visible from the window.

Remove your spare key

If a criminal figures out you’re away on holidays, chances are they will scour the front of your home for a spare key. So get rid of any extra keys you may have hidden under the mat, in the pot plant, or above the door frame!

Make sure your insurance is up to date

Lastly, before you head off, make sure your home and contents insurance is up to date and you have a copy of the policy details on hand for the unlucky event that something is to happen.

 

With all these precautions put in place, it’s time to head off for a fun (and relaxing!) holiday. Have a great trip!

RBA LEAVES CASH RATE AT 1.50% - 05/12/2017

At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent.

For full article please visit www.rba.gov.au.

Laughter is the Best Medicine - 01/12/2017

1st Street’s Charity of the Month for December is Camp Quality.

Camp Quality has been supporting children living with cancer and their families since 1983.

They understand that having a child diagnosed with cancer can be devastating. A family’s world is turned upside down and the emotional, physical and financial impact can last long after the initial diagnosis.

Camp Quality believes that caring for children with cancer and their families goes beyond treatment and medication. They believe in the power of positive thinking, and that optimistic and resilient behaviours are fundamental psychosocial skills required for the cancer journey.

Their unique programs cover educational, financial, hospital and recreational needs and are delivered to thousands of children across the entire journey throughout Australia.

A portion of all loans settled with 1st Street in December will be donated to Camp Quality.

For more information on Camp Quality or to make a donation, please visit their website: https://www.campquality.org.au/

Sydney walks we bet you don’t know about - 08/11/2017

Sydney’s eastern coastal walks are some of the city’s best kept secrets and are the perfect weekend activity to enjoy over the upcoming warmer months. These are some of our favourite picks:

Hermitage Foreshore Track

This 2.2km walk starts at Bayview Hill Road in Rose Bay and winds its way around the harbour to Neilson Park, Vaucluse. The trail weaves through beautiful bush land, secluded beaches and highlights the city from a new perspective. The walk is best enjoyed in the late afternoon when you can watch the sun gently setting over the glistening harbour.

South Head Heritage Trail

Starting and ending at Camp Cove Beach, this 1.7km circuit shows off the magnificent harbour from the heights of South Head. With a footpath leading the way to the distinct Hornby Lighthouse, you can enjoy panoramic views of both the Pacific Ocean and iconic Sydney Harbour. This Sydney walk is magnificent at all times of day however sunrise and sunset add a little extra sparkle to the experience.

Federation Cliff Walk

This 4km coastal walk starts at Raleigh reserve in Dover Heights and ends at Christison Park Vaucluse. The walk leads along a concrete path, natural grasslands and extensive timber boardwalks and highlights the rugged eastern cliffs and vast Pacific Ocean magnificently. Best enjoyed at sunrise, this walk will have you truly appreciating the unforgettable eastern coastline.

Watsons Bay to Christison Park (Coastal Cliff Walk)

A short 1.5km pathway, this walk highlights Sydney’s most famous ocean cliff lookout (The Gap) with breathtaking ocean views. Running from the start of Gap Road, Watsons Bay to wide open Christison Park Vaucluse, this strip is an easy and quick walk best enjoyed as close to sunrise as possible.

Bronte to Coogee (via Gordon’s Bay)

Starting at Bronte Beach and ending at notorious Coogee Beach, this 4km coastal walk features the continuation of iconic sandstone cliffs and rugged coastline. Passing along the historic Waverley Cemetery and uncovering the tranquil Gordon’s Bay, this walk offers an abundance of beautiful scenery, best enjoyed whilst the sun peeks over the horizon at sunrise.

Parsley Bay Suspension Bridge

The short walking track (less than 1km) begins at the western side of Parsley Bay beach by the seawall and finishes on the eastern side of the bay at the wharf.  The trail features the iconic century old cable suspension footbridge, breathtaking harbour and bushland views, weathered sandstone caves and overhanging seawall rocks. Enjoyed at any time of the day, this hidden harbour side paradise walk is a must to include on your to-do list.

RBA LEAVES CASH RATE AT 1.50% - 07/11/2017

At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent.

For full article please visit www.rba.gov.au.

1st Street Supports NBCF - 01/11/2017

1st Street’s Charity of the Month for November is the National Breast Cancer Foundation.

The National Breast Cancer Foundation (NBCF) is 100% community funded and the only national body that funds life-changing breast cancer research with money raised entirely by the Australian public. Breast cancer is the most common cancer facing Australian women, with eight women dying from the disease each day — mothers, sisters, wives, daughters and friends.

Research is the only way to prevent deaths, and improve how breast cancer is diagnosed, managed and treated. By funding only world-class research, NBCF is working towards a goal of zero deaths from breast cancer by 2030. With 48 Australians diagnosed each day and eight dying from the disease, there is still much to do.

At 1st Street we believe this is a cause worth supporting and will donate a portion of our income earned for all loans settled in the month of November.

For more information on NBCF or to make a donation, please visit their website: http://nbcf.org.au/

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