Interest rates are expected to rise later this year, having sat at record lows since 2019. While the Reserve Bank of Australia has insisted it won’t lift the rate until 2024, or 2023 at the earliest, banks like Westpac are beginning to question this assertion. Indeed, Westpac’s chief economist Bill Evans has predicted an initial rise of 15 basis points and then a further rise of 25 basis points in October, which would bring the cash rate to 0.5%. According to Canstar, this would push banks to respond, at which point we can expect the average variable rate to increase to 3.43%. Rising interest rates are expected to pull housing prices back as buyers drop out of the market and those who are well and truly over-mortgaged are forced to sell. Whether or not you own a home, there are a few things you should focus on over the next few months to ensure that rising rates won’t hurt your financial position and add pressure to your life. These five strategies are particularly important to consider as they may help reduce stress when you work as a contractor on a variable income. Put an adaptable financial plan in place, beginning by establishing a clear and realistic budget. Factor in your mortgage repayments / rent and any other debts you’re paying off and fixed costs of living. Work out whether you’d be able to cover the cost of living if the interest on your mortgage / debt repayments rose by 0.5%. or even 1% If you don’t think you’d be able to cover your costs, start thinking about how you can reduce them now, Get ahead of your mortgage / debt repayments now, while you can afford to – this could significantly reduce the amount of debt that your loan repayments are being calculated on, If you own a property, talk to your bank or a broker about whether you should fix the interest rate on at least part of your mortgage, If you’re running with multiple credit cards, consider consolidating your debt into one card with one manageable payment per month – you may be able to switch your credit card debts into one new card with a special low (or zero) interest rate period that will enable you to make some significant repayments, and Most importantly, talk to an expert who can advise you on your personal situation – and don’t leave it too long. Grow Your Wealth At the Ayers Group we’re here to help you grow your wealth with administrative services that maintain your compliance and free you to focus on your contract work. We can also connect you with experts on novated car leasing, financial management and more so you can make the most of every dollar you earn. Contact an expert from the Ayers Group today to find out more.