So the RBA’s raised the interest rate. Yes!

Friday, March 5th, 2010 at 17:06

The Reserve Bank of Australia this week raised its cash rate by 0.25% to 4.00%. I read in the newspapers that this would add about A$50 per week to the average mortgage. In some newspapers, the rate rise would be “painful” for the Aussie battlers. But surely, if an increase of A$50 would cause so much pain, why take out such a large mortgage? How about comparing this pain to the pain inflicted on us by the plastic fantastic cards in our wallet. Credit card interest rates are almost 3 times as much as the standard home loan rate. Why not cut back our credit card limit? Or even better, ask the banks to reduce their penalty rates and late payment fee to help us cope with the pain. The penalty rates and fees are disproportionate to the interest they charge on the outstanding balance in many cases! One positive coming out of the interest rate rise is higher interests on deposits. Yes!

Tags: ,