Financial planning for success after you’ve moved house

Whether you’ve just bought your family home or sealed the deal on a sweet rental, picking up those keys and moving into your new place is not only exciting, it can feel like one of life’s major milestone moments.  

But turning the page on your new property chapter can also deliver a checklist of jobs and responsibilities, including a fresh set of financial commitments. One way to feel confident that you can meet them is being proactive about financial planning rather than sitting back and waiting for any stress to set in before you take action. 

Below you’ll find some practical money management tips that can help turn your new home into a financially happy one, now and into the future. 

What we’ll cover

Assess your new financial landscape 

As a first step, it’s a good idea to get your head around the costs that buying or renting can deliver once you’ve unpacked your stuff and begun to call the place your own. 

The costs of renting a house 

After you’ve taken care of the upfront costs, including the bond, removalist fees and getting the utilities connected, there are ongoing costs to factor in, including: 
 

• Paying the rent: Median weekly rental prices vary around Australia. It’s also worth keeping in mind that how often and how much your rent can rise depends on your home state or territory. 
• Insurance: You may want to take out contents insurance to cover your household items and personal belongings against things such as theft, accidents or natural disasters. 
• When the lease ends: You might have to spend some money in order to leave the property empty and clean, so you can get your bond back. There’s often a cost involved if you decide to end the lease early and rules differ depending on which state you are in.  

The costs of buying a house 

On top of initial costs such as stamp duty, legal fees and paying for building reports, ongoing costs can include: 
 

• Council rates: These are calculated annually so may rise year to year. Check with your relevant council. 
• Insurance: Taking out home and contents insurance could cover the cost of repairing or replacing your house and your belongings if something goes wrong. 
• Mortgage repayments: These can fluctuate with changing interest rates or if you decide to make extra repayments. You can plan ahead for this by working out what your home loan repayments would look like, whether you pay them weekly, fortnightly or monthly, if something changes. 

Revisit your budget

Once you’re across the costs that are part and parcel of your new home’s package, you may need to shift your spending to suit. And that means one thing: budgeting. This handful of steps can help you balance the books. 

Build the big picture 

Using an online budget planner is a simple way to compare how much money you’ve got coming in with how much typically goes out each month – including on those new expenses since you’ve moved. This allows you to broadly work out whether you’re earning more than you spend, and if you aren’t, gives you the opportunity to start identifying where you could save money to turn your finances around. 

Track your spending 

Once you’ve got a general understanding of ‘money in, money out’, the next step is knowing exactly what you’re actually spending your money on each month. Tracking this to the dollar across different categories, including fixed expenses such as rent or mortgage repayments and flexible non-essentials such as eating out, can help you budget more accurately. You’ll also discover whether you can afford to splurge or where there’s savings to be made. 

Consider setting up different bank accounts 

Managing your money can be easier if you have separate bank accounts for different parts of your budget. For example you might have one account for bills and other fixed expenses, another for spending on those non-essentials-but-nice-to-haves, and one more for savings. You can allocate an appropriate amount into each account whenever you get paid for peace of mind that the money will be there when you need it.

Manage your bills

Forgetting to pay them on time can result in being charged late fees. Yikes! Solutions include either automating your bill payments or using a Bills Calendar, which lets you add and track bills, and sends reminders when they’re due so you can make missed payments a thing of the past. 

Look for other simple savings

Other ways to make your budget stretch further include:
 

• Cancelling subscriptions or memberships you don’t use often.
• Shopping around for better deals on services such as insurance and electricity as well as your internet and phone.
• Reducing your food spend by planning ahead, comparing unit prices when you’re shopping, buying in bulk, meal prepping, eating less meat and leaning on seasonal produce.
• Using less electricity by operating appliances outside peak times, running your washing machine with a full load and being smart about how you heat and cool your home. This can include blocking draughts, using blinds to help control indoor temperatures and only heating or cooling the room you’re using.
• Getting Cashback when you shop online across thousands of different brands with ShopBack. 

Understand how to pay off a mortgage faster 

There are loads of reasons why paying off your mortgage earlier than the original loan term is a good idea and three strategies can help you get there.  

Refinance  

Take the time to go through the refinancing process if your home loan has celebrated a few birthdays or the financial climate has recently changed, and you could end up with a shiny new loan with better features, including a lower interest rate. Provided this benefit outweighs the costs of refinancing, it can save you some serious money, which you can use to make bigger or extra home loan repayments.  

Redraw 

If your mortgage comes with a redraw facility, it means you can make extra repayments. You might choose to use that money you’re saving on interest after refinancing or you could dip into your savings. Good-to-know info is that you can also redraw, or take out these additional funds from your mortgage account at a later date if you need to. 

Offset 

This is a separate account that’s linked to your home loan. How does an offset account work? Pop anything from your wages to your savings or a windfall in there and that money gets offset against the balance of your loan. While this makes it different to a redraw facility, the effect is similar because it can reduce how much interest you pay, which can help you pay off your loan faster. 

Plan for the future 

As you pay off your mortgage, you’re building equity – and that can be used for an investment in your future. So, how do you use equity in your home? As well as moving you closer to being debt free, with home equity financing you can use the equity you have in your property to reach another financial goal.  

Celebrate your wins! 

You might be contemplating how to pay off a home loan sooner if you’ve just bought a place, or how to save for a house deposit while renting if you've just signed a lease – but don’t forget what you’ve already achieved financially to get where you are today. From saving for a rental bond or a house deposit to paying down a credit card and making the first deposit into a savings account, every financially forward step counts and can motivate you to make the next one.  

Westpac is ready to help 

As always, we’re here to help. For more information about how our bank accounts and the Westpac App could help streamline your budget now that you’re in a new place or how to use the equity you’re building in your home, call us on 132 558 or visit a branch. 

Bank with another lender? No worries. Our team can assist in finding you a home loan full of features that may help you pay off your mortgage faster and guide you through the refinancing process to make the switch to Westpac.