During these unique times, we are stronger together. It’s important at this time that we support each other – our team has put together a list of ways to help you manage your finances during COVID-19 (Coronavirus). Our brokers have over 100 years combined experience in finance and have helped navigate their clients through many challenges. We recommend getting in touch with your broker directly to review your finances and discover what support could be available to you and the opportunities that exist to help you navigate the ever-changing government and lender policy at this time.
1. Call your bank
The banks want to work with you and help accommodate you like never before. If your income has been affected by COVID-19 (Coronavirus), be sure to mention this when you call so they are able to enact their new policies in relation to deferred payments, a halt on late fees and more. Most lenders are now offering relief for up to six months on personal and business lending and generally asking that you request the relief online via a dedicated link. We recommend you continue to keep in touch with your bank as the situation and their policies are changing rapidly to respond to the government and resulting market conditions.
2. Call the ATO (Australian Taxation Office)
The ATO has multiple support options available for your tax obligations whether that be personal or business. You can call 1800 806 218 as well as find more information and read the frequently asked questions on their ‘COVID-19’ information page. https://www.ato.gov.au/Individuals/Dealing-with-disasters/In-detail/Specific-disasters/COVID-19/
3. Visit business.gov.au (support for businesses in Australia)
This is a fantastic website that has an enormous amount of up to date information as well as a brilliant customer service team. Find out about the COVID-19 support available for sole traders, employers and companies. https://www.business.gov.au/risk-management/emergency-management/coronavirus-information-and-support-for-business
4. Review support options on your State Government website
A lot of the initiatives from business.gov.au are being rolled out on a state by state basis. Review your State Government website to discover what initiatives have been rolled out in your area. https://www.wa.gov.au
5. Review government grants available
The Australian Government has a grant information system ‘Grant Connect’. For those in business, there may be a suitable stimulus opportunity, you can search all available grants via their portal below. They can be contacted via email [email protected] or call 1300 484 145. https://www.grants.gov.au
6. Use offset/redraw accounts to reduce your interest repayments
We recently wrote an article that goes into detail about how you can pay your mortgage faster using offset or redraw accounts. If you have available funds in your redraw or offset account, you could consider using these funds to assist you to continue making the scheduled repayments on your loan. Contact your broker to discuss this further. https://www.launchfinance.com.au/our-new-redraw-or-offset-tool-pay-your-mortgage-faster/
7. Redraw on existing home loans due to rate cuts
There have been five interest rate cuts by the reserve bank over the past 8-9 months. When the banks pass on a rate reduction, reducing the interest rate on your home loan, they don’t automatically reduce your monthly loan repayment. This means that you are paying more off of the balance of your home loan, is the interest amount charged is lower. This is a great thing, however in trying times such as these, you can negotiate with your lender to reduce your monthly loan repayment to the minimum required, and free up some much needed cashflow.
Contact your bank directly to amend your minimum repayment.
8. Review your current loan
Due to record low interest rates, now is a great time to negotiate with your bank to reduce the interest rate on your current loan or review other lenders in the market. If you have had you’re your home loan for over 2 years, we recommend contacting your broker for a home loan health check. Contact your broker to help you navigate this, there could well be substantial savings that you can make at this time.
9. Review your personal monthly budget
The budget review! Oh yes, it is the perfect time to do this. Have a look at your discretionary expenses now and plan ahead.
10. Small Business cash flow review
If you’ve followed the tips in this article so far, you will have a good understanding of what support is available to your business and how this affects your cash flow. Have a look at your fixed costs and map out your cashflow for the next 6 months. Knowing your new numbers, understanding where your income comes from and keeping in contact with these businesses will keep your business top of mind.
11. Get professional advice
We certainly recommend seeking out professional advice, whether that be getting in contact with your broker to discuss all aspects of this article and/or contacting your financial planner to discuss your options in relation to other financial arrangements including superannuation.
12. CONNECT with friends & family
Connection and community in all aspect of your life right now is one of the greatest support options there is. Reach out for support and offer it to others, we are stronger together.
Our hearts are with everyone whose income has been affected. On the flip-side, in every economic down-turn, there are those businesses who will thrive as the current climate needs their products or services in higher demand. For those whose income has not been affected or is on the rise, now is an opportune time to take advantage of record low interest rates.
Although this is a very unique and challenging time, there is a lot of support available. Our brokers are part of your support team and we are here to help you, reach out and have a chat at your earliest convenience. Launch Finance is based in Western Australia and services clients nationally. Our offices are located in Perth and Mandurah, contact us on (08) 9367 4222 or [email protected] and we will put you in touch with one of our expert brokers in your area. If you are a current Launch client, we recommend you call your broker directly on their mobile, the most up to date details for our team can be found here.