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Like the six meetings before it, yesterday's Reserve Bank of Australia's monthly board meeting delivered more pain for home owners.
Key points:
- Australia's cost of living continues to rise
- Financial counselling is required to be a free and confidential service
- Here four financial counsellors offer their best tips to save money
Another 0.25-percentage-point increase in the RBA's cash rate means home loan repayments will grow yet again – at a time when the cost-of-living crunch is also growing across the nation.
It will mean that more Australians are left making difficult decisions to keep the lights on, a roof over their head and food on the table.
Four financial counsellors have shared their tips for managing the increasing pressures before it gets too late.
Colleen Crowley has spent more than 16 years helping people manage their money at the City of Cockburn in Perth's southern suburbs.
Statement analysis
Her first recommendation is to go through bank statements and flag each transaction either red, orange or green.
"You can't get up every day and just keep doing the same things that you've always been doing," she said.
"You've actually got to stop and take stock of what you're doing with your money."
Any contractual obligations — such as rents or a mortgage — get marked in red, because they're fixed costs that can't be changed.
Things such as utilities and grocery bills get marked in orange: They're more difficult to change but can be adjusted with some effort.
Finally, things that are nice to have get coloured green as a signal they can probably go: Things such as hobbies and sports that are not part of the bare necessities.
"That'll cost you time but [can] save you a small fortune," she said.
"It's a scary thing because we don't' want to change our lifestyles. We want to keep going out … but it's not that hard."
Changing spending habits
At the other end of the city, Paul Jordan from Uniting WA has also been seeing demand for his services growing.
His suggestion is to get to the root of the problem by figuring out what makes you spend money when you do not need to, and addressing that source of stress.
"We all know that we're supposed to save money, invest money, reduce that debt, as much as possible," he said.
"To actually go and make it happen is another matter altogether.
"We need to understand what sorts of events will actually trigger the fast-thinking part of the brain, so we can engage more of that slow-thinking part of the brain to make those rational decisions."
Mr Jordan gives the example of a stressful day at work leading to someone spending money on alcohol, a habit that could be replaced with something better.
"You might go to the beach after work, you might go to the gym, you might take the dog down to the park for a walk, that might be a different way of de-stressing," he said.
"So long as it's beneficial, so long as it's not more costly … then the more that replacement action becomes a habit and you're more likely to change what it is you're doing."
'Divide, automate and conquer'
Victoria Shakeshaft from Communicare has been noticing people are feeling the pinch from all directions.
"Rising cost of petrol, certainly interest rates, coupled with the rental crisis in Western Australia, [are] really putting pressure on people when it comes to housing, petrol and, of course, [the] rising cost of groceries," she said.
Her recommendation is to tackle bills by adopting a "divide, automate and conquer" strategy.
"Look at how often you get paid. You have a look at how much your utility bills are regularly, divide the amount, on average, by how much you get paid," she said.
"So, instead of having let's say a $400 bill, every two months, we set up a system where your bank account automatically transfers a smaller amount every time you get paid.
"If you get paid monthly, we'll do two lots of $200, if you get paid fortnightly we'll do four lots of $100.
"So, instead of getting hit with a $400 bill, or however much it might be, we do regular small repayments in line with your pay or Centrelink payments, so that you're able to manage the final bill a lot easier."
Don't get complacent
Nathan Borland is a senior financial counsellor with The Salvation Army's Moneycare service in Perth's north-east.
He's encouraging people to avoid complacency.
"Research what else is out there on the market," he said.
"Get in touch with your mortgage provider as well. Once you've done the research, see if they can offer you a better deal or match what you're already found."
However, he said, any changes to things such as mortgages or insurance policies needed to be approached with caution.
"What [you're] signing up to, it might seem cheaper, but is it really?" he cautioned.
Reading the fine print would always be the key, he said.
Mr Jordan said he had noticed fewer clients not showing up for their appointments with him, a sign of how concerned many were becoming about their financial position.
"People are coming in and they're nervous. They've never spoken to a financial counsellor before and they're embarrassed. They're ashamed," he said.
Despite those feelings, Ms Shakeshaft encouraged people to accept help when it was needed.
"It's OK to feel shame about your money situation."
"It's a lot more normal than people think that it is, and it does happen a lot," she said.
"Don't let that shame stop you from asking for help. We are here to help you. We're not here to judge you."
Financial counselling is required by law to be a free and confidential service.
It is offered by some not-for-profit organisations to help advise people about their situation and, in some cases, advocate on their behalf.
For more information, see the federal government's MoneySmart website.
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