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Indexation & HECS/HELP Debt · She's On The Money

0:00
Speaker 1: Hello, my name's Santasha Nabananga Bamblet. I'm a proud yr
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Speaker 1: the Order Kerni Whoalbury and a waddery woman. And before
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Speaker 1: we get started on She's on the Money podcast, I
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Speaker 1: would like to acknowledge the traditional custodians of the land
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Speaker 1: of which this podcast is recorded on a wondery country,
0:18
Speaker 1: acknowledging the elders, the ancestors and the next generation coming
0:22
Speaker 1: through as this podcast is about connecting, empowering, knowledge sharing
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Speaker 1: and the storytelling of you to make a difference for
0:30
Speaker 1: today and lasting impact for tomorrow.
0:33
Speaker 2: Let's get into it.
0:34
Speaker 3: She's on the Money, She's on the Money.
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Speaker 4: Hello, and welcome to She's on the Money, the podcast
1:00
Speaker 4: for millennials who want financial freedom, hex or help. Debt
1:05
Speaker 4: has long been described as the best debt you can have. Debatable,
1:10
Speaker 4: it's very debatable.
1:11
Speaker 5: Debatable, but still described it as that who described Is
1:15
Speaker 5: it still the case just producer.
1:17
Speaker 2: Or was it the internet?
1:19
Speaker 4: Look, I think that it's both of those things probably,
1:23
Speaker 4: But listen, as you said before we started recording this
1:25
Speaker 4: v let's baby, I think we should really got helped
1:30
Speaker 4: it Now though it helped it or hextet, what's the.
1:33
Speaker 5: They're they're same, They're the same, so I will probably
1:35
Speaker 5: accidentally call it hex interchangeably.
1:38
Speaker 2: So HEX is for those of us who.
1:40
Speaker 5: Are elder millennials, and we had Hex's debt, but it
1:43
Speaker 5: has since been updated to be called just across the
1:46
Speaker 5: board help debt helped. It sounds more cute, does it.
1:49
Speaker 5: I think it's kind of crue anyway. I don't. I
1:52
Speaker 5: don't care what it's called. I'm just mad that I
1:54
Speaker 5: can't make X jokes.
1:56
Speaker 4: Isn't as as a sexy though, that's not that's for sure.
1:59
Speaker 4: But we are talking about this because we have been
2:02
Speaker 4: getting so many messages, six.
2:04
Speaker 5: Million of them, six fi million to be exact. I
2:08
Speaker 5: would never overestimate either.
2:09
Speaker 4: Oh no, certainly not. We don't do that here at
2:11
Speaker 4: chees on them.
2:12
Speaker 2: Absolutely not.
2:13
Speaker 4: So how scared should we be of headlines like he's indexation,
2:18
Speaker 4: everything's rising? Well, I don't know.
2:21
Speaker 5: Well, it makes sense that we've been getting so many messages,
2:23
Speaker 5: right because we are hearing all through the news that
2:26
Speaker 5: on the first of June HEX is going to be
2:28
Speaker 5: indexed by seven point one percent. And I guess today
2:31
Speaker 5: is the day that we are going to be talking
2:33
Speaker 5: about that, because it is wild and when I just
2:36
Speaker 5: need to make sure that everyone is aware that I
2:38
Speaker 5: do mean the first of June, not the thirtieth of June,
2:41
Speaker 5: because a few people have messaged me because I was
2:43
Speaker 5: on Instagram Stories just like talking about it the other
2:45
Speaker 5: day and they're like, oh, don't you mean the thirtieth
2:47
Speaker 5: of June when you know end of financial year happens. No,
2:50
Speaker 5: this happens on the first of June, ahead of the
2:53
Speaker 5: end of financial year, so that in a month, basically,
2:56
Speaker 5: in the next thirty days, they can calculate what your
2:59
Speaker 5: repayments were be with the new level of indexation and
3:02
Speaker 5: can hit the ground running from the first of July basically.
3:05
Speaker 4: So I'm not wrong.
3:07
Speaker 5: I just feel the need to, like, you know, back
3:09
Speaker 5: myself a little bit and be like, this is why
3:10
Speaker 5: I'm correct. But also people were right to slide into
3:13
Speaker 5: my dams because I'm consistently wrong. So if you would
3:16
Speaker 5: like to correct me, you are more than welcome to
3:17
Speaker 5: so don't. Yeah, I feel like a dip when I
3:19
Speaker 5: correct myself, right, Sure, I just feel a little bit
3:23
Speaker 5: rude when I'm like, I was right.
3:25
Speaker 4: I know it is. It is a bit awkward when
3:27
Speaker 4: you have to be like Oh, actually I did. I
3:29
Speaker 4: think this is the correct.
3:31
Speaker 5: Yeah, Like, actually, I don't know if you know this,
3:33
Speaker 5: but like I'm really into finance, like really really into finance.
3:37
Speaker 5: And while I might get dates wrong consistently, if it
3:40
Speaker 5: was the thirtieth of June, I would know because that's
3:41
Speaker 5: my birthday.
3:43
Speaker 4: Oh thirty is the June's your birthday? That end July?
3:46
Speaker 2: Yes, sexy, I'm an end of financial year. Baby. Is
3:49
Speaker 2: there a better.
3:50
Speaker 5: Dated in the year than the thirtieth of June.
3:53
Speaker 4: I hope you get a big chunk of return for
3:56
Speaker 4: your birthday.
3:56
Speaker 5: No, I always end up owing money. It is actually
3:59
Speaker 5: a joke, is okay? Thank you for tho as well wishes. Though.
4:02
Speaker 5: Let's talk about debt.
4:04
Speaker 4: So you've probably heard on the news the term student
4:08
Speaker 4: debt avalanche.
4:10
Speaker 2: It's dramatic, isn't it.
4:11
Speaker 4: It seems dramatic. And I'm also like, I'm not yet scared,
4:15
Speaker 4: but like should I be scared?
4:16
Speaker 2: Whyren't you scared?
4:18
Speaker 5: I just stowed a headline that they're trying to make
4:20
Speaker 5: you scared, and you're still like, nah, take it, take it.
4:23
Speaker 5: I can take it, because like to me, I feel
4:24
Speaker 5: like avalanche, that's nothing.
4:26
Speaker 4: It's thirty bucks a month. I'm like, I don't really mind,
4:29
Speaker 4: to be honest, but like, should I be more worried
4:31
Speaker 4: about we should?
4:33
Speaker 5: I mean, at the end of the day, when they're
4:34
Speaker 5: talking about the student debt avalanche, it is proposed that
4:37
Speaker 5: on the first of June, the student debt here in
4:39
Speaker 5: Australia on the first of June is going to increase
4:42
Speaker 5: by five billion dollars this year because of that seven
4:45
Speaker 5: point one level of indexation.
4:47
Speaker 2: So that's a lot of money.
4:48
Speaker 5: And I mean for you, you might go whatever, it's
4:51
Speaker 5: thirty bucks, but to a lot of people, thirty bucks
4:53
Speaker 5: is a lot of money. And when you're paying back
4:55
Speaker 5: your HEX debt, especially if you're on a lower income
4:58
Speaker 5: and you're not maybe you know, in one of those
5:00
Speaker 5: high marginal tax brackets, but you're in the bracket where
5:02
Speaker 5: you're starting to pay back your debt, it just feels
5:05
Speaker 5: like it stacks on a little bit, like it genuinely
5:07
Speaker 5: feels like you're getting nowhere. And I mean you are,
5:10
Speaker 5: I promise, but it just feels like you're going backwards.
5:13
Speaker 5: And I think that there's just this I don't know,
5:14
Speaker 5: it's just a unspoken concept of hex versus help that
5:20
Speaker 5: it's there to help you, and it feels like you're
5:23
Speaker 5: kind of being kicked while you're down. Like you already
5:25
Speaker 5: have hex debt, You already see it on your pay
5:27
Speaker 5: slip coming out. You already know that that's money that's
5:29
Speaker 5: not going into your back pocket. We know how we
5:32
Speaker 5: feel about debt in general. Yes, we've spoken about the
5:35
Speaker 5: difference between good, bad, and okay debt here on the podcast.
5:38
Speaker 5: But I just feel like we're all just a little
5:40
Speaker 5: bit salty with indexation because for so long we've just
5:43
Speaker 5: talked about how hex slash help debt doesn't have an
5:46
Speaker 5: interest rate associated with it, right, So when you hear
5:49
Speaker 5: that beck, you smile and nod, go yeah great, but
5:51
Speaker 5: it is indexed, So it kind of feels like we're
5:54
Speaker 5: being kicked while we're down.
5:56
Speaker 2: Does that make sense?
5:57
Speaker 4: Kind of? But I guess, like what my estion is
6:00
Speaker 4: is what is indexation and what are the basics of it?
6:05
Speaker 2: Stunning question.
6:06
Speaker 5: So indexation basically just means an adjustment to a price
6:09
Speaker 5: or a wage or other value based on the changes
6:12
Speaker 5: in other prices or a composite indicator of prices. Right,
6:15
Speaker 5: So we spoke about it a couple of weeks ago
6:17
Speaker 5: on the podcast where indexation is basically how much something
6:22
Speaker 5: increases in value over time. And my favorite example of this,
6:25
Speaker 5: which I didn't give you a saved it for this podcast.
6:28
Speaker 5: The maccas cone. Oh Maca's ice cream cone, right, yes,
6:33
Speaker 5: So like, do you remember back in the day. I
6:35
Speaker 5: don't know if you ever had this luxury, but my
6:39
Speaker 5: mum would give me a fifty cent coin silver.
6:42
Speaker 2: It was silver.
6:43
Speaker 5: I don't know if anyone sin silver coins these days,
6:46
Speaker 5: because they can't buy you anything anymore. But I get
6:49
Speaker 5: a fifty cent cone from macis.
6:51
Speaker 4: I actually remember when they were thirty cent.
6:53
Speaker 5: I feel like they went twenty cents. I feel like
6:55
Speaker 5: twenty twenty. But last time I spoke about that publicly,
6:58
Speaker 5: everyone was like, they are fifty cents. Was going to
7:00
Speaker 5: call it fifty cents, right, So I do remember, probably
7:03
Speaker 5: late primary school I was paying fifty cents for a
7:05
Speaker 5: Maca's cone. After school, we go to swimming lessons and
7:08
Speaker 5: then we get a Maca's cone. Is like our treat,
7:11
Speaker 5: little treaty treat for you know, going to swimming lessons,
7:14
Speaker 5: as though it's not already a privilege to go to
7:16
Speaker 5: swimming lessons, like Victoria Devine anyway, you're right. I feel
7:20
Speaker 5: like it used to be twenty cents at some point,
7:21
Speaker 5: but this is beyond the point. It is now what
7:23
Speaker 5: like a dollar fifty? A dollar fifty, I think it's
7:25
Speaker 5: like more than a dollar.
7:26
Speaker 4: Oh, blow me down.
7:27
Speaker 5: I feel like in different locations around Australia, somewhere you're
7:31
Speaker 5: gonna say, oh, they're a dollar, somewhere else they're like
7:33
Speaker 5: a dollar fifty. Right, Okay, so that has increased in
7:36
Speaker 5: price over time. But are you getting the same product, beck,
7:40
Speaker 5: I would say, identical product identity, It's just nowadays it
7:44
Speaker 5: costs more to produce.
7:45
Speaker 2: It's going to be more expensive.
7:47
Speaker 5: So the dollar that you used to have back in
7:49
Speaker 5: nineteen ninety eight, when I was seven years old and
7:51
Speaker 5: going to swimming lessons and paying twenty cents for a cone,
7:54
Speaker 5: I could have bought five of those ice cream cones
7:57
Speaker 5: for a dollar. But today, if I gave you a dollar,
8:00
Speaker 5: you could only buy one, and in some locations you
8:01
Speaker 5: wouldn't even be able to buy one. You need another
8:04
Speaker 5: fifty cents to get there. Right, So a dollar today
8:07
Speaker 5: is not worth what a dollar tomorrow is worth. And
8:10
Speaker 5: that's what that saying means. So indexation is that increase
8:13
Speaker 5: in price. So it's the difference of going from twenty
8:16
Speaker 5: cents to a dollar and you kind of don't get
8:19
Speaker 5: any more value out of that product. You're still getting
8:22
Speaker 5: the Maca's cone. There's actually no more value. It's not
8:24
Speaker 5: any better today than it was back then because it's
8:27
Speaker 5: probably the same recipe. So like nothing has changed about
8:29
Speaker 5: it except the price. And that's what inflation is. It
8:32
Speaker 5: just means that a dollar back then was actually quote
8:35
Speaker 5: worth more because you could buy more with that dollar
8:38
Speaker 5: than it is today.
8:39
Speaker 4: So at the end of every financial year, the government
8:44
Speaker 4: will tally up how much inflation goes inflation goes up,
8:48
Speaker 4: and then add that to your texted Yeah, okay, So
8:51
Speaker 4: it's kind of like across the board as well. I mean, milk, eggs, bread,
8:54
Speaker 4: everything goes up. But the reason it goes up is
8:58
Speaker 4: because things start to cost more. The world starts to
9:01
Speaker 4: cost more, beck you start to earn more, like the
9:03
Speaker 4: world does increase over time. And when we look at it,
9:06
Speaker 4: the RBA, which is the Reserve Bank of Australia, they're
9:09
Speaker 4: kind of in charge of making sure that's consistent for us.
9:12
Speaker 4: And the reason we want it to be consistent is
9:15
Speaker 4: so we can consistently afford to grow as an economy.
9:19
Speaker 4: Inflation on average increases about two or three percent each
9:22
Speaker 4: and every single year, which is good.
9:24
Speaker 2: That's nice.
9:25
Speaker 5: It's actually a sign of a growing economy like that
9:27
Speaker 5: means that we're healthy as a country, right, So that's
9:30
Speaker 5: good to see. This year it's seven percent, and it's
9:32
Speaker 5: because we've gone through so much turmoil in the last
9:35
Speaker 5: couple of years. That's kind of like now hitting us
9:38
Speaker 5: like a ton of bricks, and so we're feeling the
9:41
Speaker 5: wrath of what has happened previously, and the RBA historically
9:45
Speaker 5: has tried to like protect us from that. So the
9:47
Speaker 5: way that they're trying to protect us from that is
9:49
Speaker 5: by increasing the cash rate.
9:51
Speaker 2: So the cash rate is.
9:52
Speaker 5: How much they're lending the let's call it the government's money,
9:55
Speaker 5: how much they're lending the government's money out to the
9:57
Speaker 5: big banks. So by increasing the ca hash rate, it
10:00
Speaker 5: costs the banks more to borrow the money from the
10:03
Speaker 5: RBA to give people mortgages and.
10:05
Speaker 4: Business loans and personal loans and home loans. And when
10:08
Speaker 4: home loans and business loans and personal loans increase in
10:11
Speaker 4: the amount of interest you're paying, that means you're less
10:14
Speaker 4: likely to take it out.
10:15
Speaker 5: Right, So if I said, Beck, you can buy a
10:17
Speaker 5: house today, it's going to be like one point five
10:19
Speaker 5: percent finance Like, you're going to get an interest rate
10:22
Speaker 5: that's really low. You go some money in, that's a
10:25
Speaker 5: good deal. I can afford that. That's only one point
10:28
Speaker 5: five percent. But now today it's much higher than that,
10:32
Speaker 5: and a lot of interest rates are at five percent.
10:35
Speaker 5: You start to go, oh, I don't know if I
10:37
Speaker 5: could afford those repayments. I don't know if that's going
10:39
Speaker 5: to work for me. So you as the consumer, the
10:41
Speaker 5: person that gets the mortgage or gets the personal loan
10:43
Speaker 5: or gets the business loan, you're less likely to take
10:46
Speaker 5: it out. And if you're less likely to take it out,
10:48
Speaker 5: what that means is the economy starts to slow down
10:50
Speaker 5: because there's less people like you making big purchases and
10:54
Speaker 5: throwing money around, so that the economy starts to go
10:57
Speaker 5: down a little bit. And that's what they're trying to do,
11:00
Speaker 5: so that we can curb that growth or the inflation
11:03
Speaker 5: over time. So if you're doing less in the economy,
11:05
Speaker 5: like you're not buying as much, things are a bit
11:07
Speaker 5: more expensive. You're kind of like holding your purse a
11:09
Speaker 5: little bit closer to your chest, going like, I don't
11:11
Speaker 5: know if I want to, you know, pay for that
11:13
Speaker 5: this month. It means that there's less business going on
11:16
Speaker 5: in the community and less business going on in the country,
11:18
Speaker 5: which means ultimately the economy isn't doing as well, and
11:22
Speaker 5: that's what they're trying to create.
11:23
Speaker 4: Does that make sense, Yeah, that does make sense.
11:26
Speaker 5: So like things are just kind of like slowing down,
11:27
Speaker 5: and they're doing it on purpose because they want people
11:29
Speaker 5: like you to be boring less money.
11:31
Speaker 4: Yeah, okay, So I guess for me, and I've said
11:35
Speaker 4: this before, I do have a help debt. I've ever
11:39
Speaker 4: finished a course, so I've just that's.
11:41
Speaker 5: Literally the worst, Like I mean, not the worst that
11:44
Speaker 5: you've done. I'm sure you've got a lot out of it,
11:45
Speaker 5: but the amount of people in our community I've spoken
11:48
Speaker 5: to you, like I have a help debt, I don't
11:49
Speaker 5: use it. Yeah, Like I went to union and I
11:51
Speaker 5: did this and now don't even work in the area.
11:54
Speaker 5: Or my friend did this course. I thought I'd do
11:57
Speaker 5: that course and then it was a terrible course and
11:59
Speaker 5: I didn't enjoy it, or now I have thirty thousand
12:01
Speaker 5: dollars absolutely. I feel like I've started like five or
12:04
Speaker 5: six subjects and never finished any of them.
12:06
Speaker 4: So I just have all this money and no qualifications.
12:08
Speaker 4: But that's okay because we're still here to tell the story.
12:11
Speaker 5: We're happy about it. We're making content because that.
12:13
Speaker 4: Was worth it.
12:14
Speaker 5: It was worth it.
12:14
Speaker 4: It was worth it, and you know, I learned that
12:17
Speaker 4: if you learn something, it's not a waste, no matter
12:20
Speaker 4: how you did it all week whatever. You know what
12:21
Speaker 4: I'm trying to say.
12:22
Speaker 5: I think it was my mum. I'm not sure who
12:24
Speaker 5: it was. I want to give her credit for it,
12:25
Speaker 5: though she always says it was either a blessing or
12:28
Speaker 5: a lesson. I love that, and I feel like that's
12:31
Speaker 5: good because it always reframes something as if it was
12:35
Speaker 5: kind of terrible.
12:36
Speaker 2: Let's just call it a.
12:37
Speaker 5: Lesson, exactly, exactly, just call it a lesson. It makes
12:40
Speaker 5: me feel so much better about it.
12:42
Speaker 4: Perfect. So I mentioned this is the start of the episode.
12:46
Speaker 4: I kind of am not stressing about the I suppose
12:50
Speaker 4: like the indexation on hextet or helped it.
12:52
Speaker 5: I want to stop you there because I want to
12:53
Speaker 5: hear why, like, why do you not feel that pressure
12:57
Speaker 5: when obviously a lot of people in the media jumping
13:00
Speaker 5: up and down the exacting Oh my gosh, what's going on? Why?
13:02
Speaker 4: So this is the thing. I don't know what that
13:07
Speaker 4: looks like. So for me, helped, it remains the same.
13:10
Speaker 4: And I'm so ignorant because I have no idea. But
13:12
Speaker 4: for me, I think that, you know, I'm just going
13:15
Speaker 4: about my business. I'm paying like two bucks a week
13:18
Speaker 4: in hextet. When my employee takes out of my pay slip,
13:23
Speaker 4: and then this is going to happen. My hex debt
13:25
Speaker 4: is going to go up and my pay slip will
13:28
Speaker 4: be exactly the same. So I don't know where the
13:31
Speaker 4: fear is. But I could be completely wrong. I could
13:34
Speaker 4: it could be changing my take home income.
13:38
Speaker 5: I don't know, all right, Beck, So we just took
13:41
Speaker 5: a really quick minute away from the podcast so I
13:44
Speaker 5: could get out a few calculators for you and organize
13:48
Speaker 5: what this looks like.
13:49
Speaker 4: And now I'm scared.
13:50
Speaker 2: No, don't be scared.
13:51
Speaker 5: But I do think it's really important to understand where
13:53
Speaker 5: you stand and how that works for you. So my
13:56
Speaker 5: favorite website, and I have, you know, put it in
13:58
Speaker 5: the show notes before. It's paycalculator dot com dot au.
14:02
Speaker 5: And the reason I like this is because it's up
14:05
Speaker 5: to date with what's going on on the ATO website.
14:08
Speaker 5: But in all honesty, it's better than the ATO website.
14:11
Speaker 5: It's a privately owned website. I mean, this guy whoever
14:14
Speaker 5: owns paycalculator dot com dot u is a wizard, because
14:18
Speaker 5: everybody in the industry or in my industry uses this
14:21
Speaker 5: website as kind of like a really good base level
14:23
Speaker 5: calculator to just like go, oh, I'll whip it out,
14:25
Speaker 5: see what's going on. You know, pop in your income,
14:28
Speaker 5: see what that looks like. Anyway, everybody uses it, but
14:31
Speaker 5: it's covered in ads, and you just know he's breaking
14:34
Speaker 5: it in because every single time someone in our industry
14:37
Speaker 5: goes there or you go there, he's making money. So
14:39
Speaker 5: I just feel like that was a genius thing from him.
14:42
Speaker 5: That is genius exactly. So if you go to this website,
14:44
Speaker 5: you can basically put in your salary and then click options,
14:48
Speaker 5: So you could click your salary includes superannuation or it doesn't,
14:52
Speaker 5: or you could click student loan, which is what we're
14:55
Speaker 5: talking about here. Yes, so many people, just like you,
14:58
Speaker 5: they don't know what they're paying. All they see is
15:00
Speaker 5: these headlines and get really stressed. Out about like, oh
15:03
Speaker 5: my gosh, I'm going to be paying seven percent indexation,
15:06
Speaker 5: Like I already can't afford a house. I already, you know,
15:08
Speaker 5: struggle to buy a good coffee every friggin day, Like
15:11
Speaker 5: what's going on. So, when it comes to calculating your repayments,
15:16
Speaker 5: it's actually based on income thresholds, and those are different
15:19
Speaker 5: from your marginal tax bracket. So your marginal tax bracket
15:23
Speaker 5: is kind of the most normal one, which sits in
15:25
Speaker 5: that thirty two point five cents per dollar, which most
15:28
Speaker 5: people are in in our community, because it sits between
15:30
Speaker 5: forty five than one twenty, Like, that's a really wide bracket.
15:34
Speaker 5: People often think that that bracket then applies to your HEX,
15:37
Speaker 5: but it doesn't.
15:38
Speaker 2: It's different from that.
15:39
Speaker 5: So if you earn under forty eight thousand, three hundred
15:41
Speaker 5: and sixty one dollars, you don't pay any of your
15:43
Speaker 5: HEX back. After that point, it starts to increase, and
15:47
Speaker 5: the first amount that you pay back is one percent,
15:49
Speaker 5: then two percent, then two point five percent, and that
15:52
Speaker 5: is the repayment of your income. It's a percentage of
15:55
Speaker 5: your income, not a percentage of the debt that you owe. Right,
15:58
Speaker 5: So if you earn forty eight thousand to fifty five thousand,
16:02
Speaker 5: eight hundred and thirty six dollars, you pay back one percent.
16:05
Speaker 5: If you're between fifty five and I'm just going to
16:07
Speaker 5: round these down, but fifty five and fifty nine it's
16:09
Speaker 5: two percent, fifty nine and sixty two it's two point five.
16:12
Speaker 5: Sixty two to sixty six it's three, and so on
16:14
Speaker 5: and so forth. Let's pretend for a hot second that
16:17
Speaker 5: you earn an income between seventy four hundred and ninety
16:20
Speaker 5: three dollars and seventy four thousand, seven hundred and twenty
16:23
Speaker 5: two dollars. That means that your repayment rate is four percent.
16:27
Speaker 5: So if we calculated that out, and I've just popped
16:30
Speaker 5: in a random number, and I can do this for
16:31
Speaker 5: you offline, so it's your specific income back. But I've
16:34
Speaker 5: pretended that you're on seventy three thousand dollars, right, which
16:37
Speaker 5: I feel like is a pretty normal income for our community.
16:40
Speaker 5: That means that every single week from your paycheck, you
16:43
Speaker 5: would have a student loan amount of fifty six dollars
16:46
Speaker 5: coming out.
16:47
Speaker 2: That's fifty six.
16:48
Speaker 5: Dollars that you're paying towards your help or hex debt.
16:51
Speaker 5: That's not going into your back pocket. The second that
16:54
Speaker 5: your hex or help debt doesn't exist, that fifty six
16:57
Speaker 5: dollars goes back into your personal account. You start being
17:00
Speaker 5: paid it right right, So that to me is a
17:04
Speaker 5: fair whack of money, because like fifty six bucks that
17:06
Speaker 5: you know, it's half my grocery bill, Like, that's a
17:08
Speaker 5: lot of money.
17:09
Speaker 2: I think it's a lot.
17:10
Speaker 5: Fortunately, that's one hundred and twelve dollars. Every single month,
17:13
Speaker 5: that's two hundred and forty three dollars, and then every
17:16
Speaker 5: single year, beck that adds up to twenty nine hundred
17:18
Speaker 5: and twenty dollars.
17:19
Speaker 2: Like, that's a lot of money.
17:21
Speaker 5: I see, nine hundred and twenty bucks. I could go
17:24
Speaker 5: on a holiday to Bali. I reckon, in this economy,
17:27
Speaker 5: the flight's probably going to cost two nine hundred dollars.
17:29
Speaker 5: But we don't want to stretch that out right, I reckon,
17:32
Speaker 5: we jet Star. We could get there. But moving on
17:34
Speaker 5: from that, I think it's important to understand what that
17:37
Speaker 5: means because if you actually increased your salary back and
17:40
Speaker 5: you were between a different tax bracket, like let's say
17:43
Speaker 5: you earn eighty four thousand dollars that student loaner payment
17:47
Speaker 5: goes up. So now on a salary of eighty four
17:49
Speaker 5: thousand dollars, you're actually paying back five point five percent,
17:53
Speaker 5: which to me is a fair whack. So five point
17:56
Speaker 5: five percent each and every single week's eighty nine dollars.
17:59
Speaker 5: Every single fort nine, it's one hundred and seventy eight dollars.
18:01
Speaker 5: Every month that's three hundred and eighty six dollars, and
18:04
Speaker 5: every year that's forty six hundred and twenty dollars. So
18:07
Speaker 5: this isn't something that we should be blinking at. Like
18:10
Speaker 5: from little things, big things grow. And I know you said, oh,
18:12
Speaker 5: it's just like thirty bucks a week or whatever, and
18:14
Speaker 5: that could be true for your circumstance, but thirty bucks
18:16
Speaker 5: a week back ends up being fifteen hundred and sixty dollars. Okay,
18:21
Speaker 5: I see, And we know that a lot of people
18:23
Speaker 5: are still struggling to get you know, one thousand dollars
18:25
Speaker 5: in their emergency fund. Yes, So it ultimately, to me,
18:29
Speaker 5: is a lot of money that we should be caring about,
18:31
Speaker 5: and I think that it's something that we do need
18:33
Speaker 5: to discuss. And whether you're paying back more or less
18:36
Speaker 5: isn't really about the conversation right now. The conversation I'm
18:39
Speaker 5: having is I really want you to understand what your
18:41
Speaker 5: paycelip means. I really want you to be in the
18:44
Speaker 5: position where you just know what those repayments are. And
18:46
Speaker 5: I mean, it's not a decision you're making like you
18:49
Speaker 5: have to pay that back. It's coming out before you
18:51
Speaker 5: even get your money back. But what we want to
18:53
Speaker 5: understand is is that something that's hindering your ability to
18:56
Speaker 5: create wealth in the future and right now for your
18:59
Speaker 5: personal situation. I don't think it is. I think it's fine.
19:02
Speaker 5: You're bopping along, you're having a good time. Like I
19:04
Speaker 5: know the financial position you're in, you shared it on
19:06
Speaker 5: the podcast before, Like you're not about to buy house
19:08
Speaker 5: in the next six months. So it's not something that
19:10
Speaker 5: we need to be worried about because it's not impacting
19:13
Speaker 5: your borrowing capacity.
19:14
Speaker 2: So personally, I don't think you do care. So do
19:17
Speaker 2: we worry.
19:18
Speaker 5: About the seven percent? I mean, yes we do, And
19:21
Speaker 5: the reason we do is because we want to understand
19:24
Speaker 5: what that means for you, pragmatically and pragmatically, all we
19:27
Speaker 5: need to understand is what does that mean for you? Beck? Right,
19:30
Speaker 5: So seven percent of thirty thousand dollars is actually twenty
19:32
Speaker 5: one hundred bucks, So that seven percent is going to
19:35
Speaker 5: mean that you go up to thirty two thousand, one
19:37
Speaker 5: hundred dollars instead of the thirty thousand dollars and beck
19:40
Speaker 5: we just said before that if you're on an income
19:42
Speaker 5: of seventy four seventy three thousand dollars, your student loan
19:46
Speaker 5: repayments every year about twenty nine hundred and twenty dollars.
19:50
Speaker 5: So you just paid twenty nine hundred and twenty dollars off.
19:53
Speaker 5: And what that's going to feel like to you is
19:54
Speaker 5: that you only paid eight hundred and twenty dollars off
19:57
Speaker 5: that year, even though every single week fifty six bucks
20:01
Speaker 5: was coming out of your account.
20:02
Speaker 2: It just increased.
20:04
Speaker 5: So no, there's no interest on that, Like you're not
20:06
Speaker 5: paying an interest amount on the repayments that you have,
20:08
Speaker 5: but that amount that you owed increased by seven percent
20:12
Speaker 5: because of indexation.
20:13
Speaker 4: Right, I see? Okay, So I guess like I have
20:16
Speaker 4: two questions, but they're kind of linked. So my thought
20:21
Speaker 4: is that if the amount you pay on your HEX
20:26
Speaker 4: is dependent solely on your income and not how much
20:30
Speaker 4: you have in HEX, yes, I feel like that's a
20:32
Speaker 4: good thing. But also on the other sides, that I'm
20:34
Speaker 4: thinking if this is a common thing that your hex
20:38
Speaker 4: staate kind of goes up on a yearly basis depending
20:42
Speaker 4: on how the economy is going and things like that,
20:45
Speaker 4: it almost feels like, is there any point in trying
20:49
Speaker 4: to like pay it off faster or anything, because it's
20:51
Speaker 4: it just feels like you're running on a treadmill.
20:54
Speaker 2: Like it's really frustrated.
20:55
Speaker 4: Gets the end of the year, you've paid x amount
20:57
Speaker 4: off and then the government's like, here's some more, and
21:00
Speaker 4: then you just end up a little bit better off,
21:04
Speaker 4: maybe even worse than you were the year before.
21:07
Speaker 5: You know, Yeah, and it makes me really really frustrated
21:10
Speaker 5: because that's an amount that you feel a bit sick about.
21:12
Speaker 5: But it's not the government trying to screw us over,
21:14
Speaker 5: let's be honest, Like, it's just not the government going, oh,
21:17
Speaker 5: do you know what, we want to increase back stuff
21:19
Speaker 5: by seven percent. I mean, they could choose not to.
21:21
Speaker 5: So the Greens were actually proposing a law that would
21:24
Speaker 5: freeze indexation for seventy four billion dollars in help loans,
21:27
Speaker 5: which has been rejected by the Senate Committee, which I
21:30
Speaker 5: think is a little bit rude. That's why I think
21:32
Speaker 5: it's so much of a hot topic in the media.
21:34
Speaker 5: A pitch it out because obviously would it help the
21:36
Speaker 5: economy to freeze help debts? Probably because people are already stressed.
21:41
Speaker 5: We're already not getting pay rises. It's why as she's
21:44
Speaker 5: on the money, we're going to be going into even
21:46
Speaker 5: more career content because I'm getting so frustrated with people
21:49
Speaker 5: just not being paid what they're worth, people not being
21:52
Speaker 5: able to afford the groceries that they were last year,
21:54
Speaker 5: people not knowing their worth because they don't have the
21:57
Speaker 5: confidence to ask, Like, I just think that the government
22:00
Speaker 5: could be doing more for us. But I guess let's
22:02
Speaker 5: have a quick look back at what indexation has looked
22:05
Speaker 5: like historically, because indexation is calculated each and every single year,
22:09
Speaker 5: and basically it's not always the same. So in twenty eighteen,
22:14
Speaker 5: indexation on our help debt was one point nine percent.
22:17
Speaker 5: In twenty nineteen, it was one point eight. In twenty
22:20
Speaker 5: twenty it was one point eight. In twenty twenty one,
22:23
Speaker 5: it was zero point six percent, in twenty twenty two
22:27
Speaker 5: it was three point nine. So it increased, and the
22:29
Speaker 5: reason it increased is because inflation in general was increasing.
22:33
Speaker 5: And what they do is they take the average inflation
22:36
Speaker 5: rate for the past two years and then apply that.
22:39
Speaker 5: So they've done that again this year, and that's why
22:41
Speaker 5: we are predicting it's going to be seven percent. That
22:44
Speaker 5: number hasn't come from nowhere. That's come from us going Okay, well,
22:47
Speaker 5: if the inflation rate last year and the inflation rate
22:49
Speaker 5: this year is this, This is what that seven percent
22:51
Speaker 5: looks like and where it's coming from. So that doesn't
22:54
Speaker 5: mean that seven percent is going to happen again. It
22:56
Speaker 5: might go back down.
22:57
Speaker 2: And in a perfect.
22:58
Speaker 5: World, if the RBA is doing exactly what they should
23:00
Speaker 5: be doing by you know, helping to slow down economic
23:03
Speaker 5: growth and helping to bring down the rate of inflation,
23:06
Speaker 5: next year, it won't be so much. So it won't
23:08
Speaker 5: be the same thing each and every year, but there's
23:12
Speaker 5: always going to be a level of indexation that is
23:14
Speaker 5: applied to help or hex steps, because that's what we
23:17
Speaker 5: signed up for sure.
23:18
Speaker 4: Okay, if only I had read the te's and c's
23:21
Speaker 4: before starting a million courses, Yeah.
23:24
Speaker 5: I just feel like even if you'd read the t's
23:25
Speaker 5: and c's, you would have been like, whatever, I don't care.
23:27
Speaker 4: That's true. Actually I could have been like, I don't
23:29
Speaker 4: know what any of this means anyway? Sign up?
23:30
Speaker 5: No, No, I'm glad we're best friends now, because I
23:35
Speaker 5: could just be like your financial fairy god brother and
23:37
Speaker 5: I could text me and be like, V, is this
23:39
Speaker 5: a good idea and be like, no, it's not. I'll
23:41
Speaker 5: like you grateful, I'll probably do it anyway. Let's be honest.
23:44
Speaker 4: I mean, maybe that's very true. It's I I'm an
23:46
Speaker 4: old dog and it's going to be hard to learn
23:48
Speaker 4: new tricks, but we're going to get there. I think
23:50
Speaker 4: this is a really good time to go to a
23:51
Speaker 4: quick break and we'll see you guys on the other side.
23:58
Speaker 4: All right, V, we are back and ready to talk
24:01
Speaker 4: about help Hex helped it.
24:03
Speaker 5: Let's talk about he be literally girl, you know what.
24:06
Speaker 5: Sam probably isn't going to cut that out. He's hope
24:09
Speaker 5: he doesn't. You know what, neither do I.
24:11
Speaker 2: Let's move on. Let's make a song.
24:12
Speaker 5: No, let's not this, Okay, sure, let's not. I'm going
24:15
Speaker 5: to stick to podcasting.
24:16
Speaker 4: Yeah, that's fair. It's a fair. That's a fair career choice.
24:19
Speaker 2: That Facebook podcasts.
24:20
Speaker 4: You do have a face of podcast. Thank you. Let's
24:23
Speaker 4: talk about help debt F. I think we were just
24:26
Speaker 4: about to talk about the interest and I don't know
24:29
Speaker 4: what these terms mean.
24:30
Speaker 5: But yeah, let's dive into let's deep dive inte why not? Yeah,
24:33
Speaker 5: so we want to talk about interest again because I
24:36
Speaker 5: think it's important to touch on it. I mentioned before
24:38
Speaker 5: that help slash Hex's debt doesn't actually attract an interest rate,
24:42
Speaker 5: it just has an indexation rate. So it's basically to
24:46
Speaker 5: take into account the different costs of living and the
24:48
Speaker 5: way I see it, And I'm not defending the government
24:51
Speaker 5: on this because I just don't think they should do it.
24:52
Speaker 5: If I'm being really honest, I just think that they
24:54
Speaker 5: should wipe it and be kind. But whatever, they're doing
24:58
Speaker 5: it so that their dollar that they len to you
25:00
Speaker 5: for your education isn't worthless when they get it back.
25:03
Speaker 4: Oh those dirty dogs.
25:05
Speaker 5: I know, right, But like it makes sense if I
25:07
Speaker 5: explain it like that, Like if I said, hey, Beck,
25:09
Speaker 5: I'll pay for your your degree. It's thirty thousand dollars,
25:13
Speaker 5: I'd like thirty thousand dollars back. But as we explained before,
25:16
Speaker 5: a macis cone in ninety seven is not worth what
25:18
Speaker 5: a macas cone is today, but the same value is there.
25:21
Speaker 5: They're basically saying, we just want the value of our
25:23
Speaker 5: dollar back so that we can you know, put that
25:26
Speaker 5: money into something else and not have it be worthless.
25:29
Speaker 5: And you kind of go, oh, that makes sense, Like
25:31
Speaker 5: that's a pretty pretty sexy explain if I borrowed money
25:34
Speaker 5: from a friend and they're like, oh, yeah, okay, can
25:36
Speaker 5: you just like, if you want to borrow the money
25:38
Speaker 5: from me, can you just make sure like there's no
25:40
Speaker 5: additional fees or charges or anything that get charged to me,
25:42
Speaker 5: because individually, I shouldn't be missing out if I'm lending
25:45
Speaker 5: the money to you. And I mean, we're not friends
25:47
Speaker 5: with the government, But that's okay.
25:48
Speaker 4: Actually it's a really good point, and I hadn't thought
25:51
Speaker 4: about that. I suppose like what would happen to the government.
25:54
Speaker 4: Will we just like crumble as a society if they
25:57
Speaker 4: were to just like freeze it and we kind of
26:00
Speaker 4: paid back the hex stet and it was worth less
26:03
Speaker 4: than when they lent it to us.
26:05
Speaker 2: There's a lot of debate about this that.
26:07
Speaker 5: I mean, that's probably why the Greens got so up
26:09
Speaker 5: in arms and they were like, it's not going to
26:11
Speaker 5: impact it. Like I feel like from my perspective, and
26:15
Speaker 5: I mean, I've shared this perspective on the podcast before.
26:17
Speaker 2: We're so lucky to.
26:18
Speaker 5: Live in Australia, right, Like, we have a beautiful economy,
26:21
Speaker 5: we have beautiful infrastructure, we have a really great healthcare system,
26:25
Speaker 5: we have roads that we can drive on that are safe,
26:27
Speaker 5: there are rules in place and there are people to
26:29
Speaker 5: protect us. Right. How good is that? But there are
26:32
Speaker 5: a lot of things that a lot of people don't
26:34
Speaker 5: agree with. I mean, we could start a conversation about
26:36
Speaker 5: the doll we could start a conversation about how government
26:40
Speaker 5: money is being channeled into the wrong education places, where
26:43
Speaker 5: could be starting a conversation about how there are a
26:45
Speaker 5: million schemes that need funding and don't have it. But essentially,
26:48
Speaker 5: I just think that the government is maintaining this so
26:51
Speaker 5: that they still have money to go around because they
26:54
Speaker 5: just don't want their dollar to be worth less tomorrow
26:56
Speaker 5: than it is today to them. And they essentially, from
27:00
Speaker 5: my perspective, they're seeing helping you out as a privilege.
27:04
Speaker 5: They're seeing it as like, Okay, well I helped beck out,
27:07
Speaker 5: she didn't have to cough up thirty grand to go
27:09
Speaker 5: to university. I'm gonna just ask for that money back.
27:12
Speaker 5: And that's a fair way of doing things. Obviously the
27:15
Speaker 5: same is not true in other countries, like in America,
27:18
Speaker 5: like they have to get very expensive student loans that
27:21
Speaker 5: are worth a whole heap of money and have a
27:23
Speaker 5: whole heap of interest associated with them. And then on
27:25
Speaker 5: the flip sides, there are countries that have a completely
27:28
Speaker 5: free education system. In fact, Australia used to have a
27:31
Speaker 5: free education system where university was free, and this wish
27:35
Speaker 5: that happened again. So essentially, what I think that they're
27:37
Speaker 5: trying to do is get back the money because they
27:40
Speaker 5: just don't have enough of it to go round at
27:42
Speaker 5: the moment. And I think that from their perspective they're
27:45
Speaker 5: doing the right things, but from a community perspective, I
27:48
Speaker 5: think they could be doing more.
27:50
Speaker 4: Amen'sis mic drop.
27:51
Speaker 2: I don't know if that's a mic drop. I just
27:53
Speaker 2: you know what I mean.
27:54
Speaker 5: I feel like we've all got our own opinions on
27:55
Speaker 5: how things work, and I just think that that's where
27:58
Speaker 5: it gets political. And this isn't a political podcast, right,
28:01
Speaker 5: I just think it's a podcast about doing the right
28:03
Speaker 5: thing and being good people. And you know, I just
28:06
Speaker 5: think that students and people who have hex stets are
28:09
Speaker 5: having a bit of a hard time what would we
28:11
Speaker 5: do about there. It's not really yeah a political conversation
28:14
Speaker 5: for me, it's not going, oh my god, the Greens
28:16
Speaker 5: a label or liberal like. The Greens had this idea
28:19
Speaker 5: to freeze indexation for seventy four billion dollars, and I
28:21
Speaker 5: nodded and smiled and said, you know what, that's a
28:23
Speaker 5: pretty good idea.
28:24
Speaker 2: I think people would like that.
28:26
Speaker 4: Yeah, absolutely, and I'm sure there will be absolutely no
28:28
Speaker 4: consequences whatsoever. So at the end of the day, I've
28:32
Speaker 4: gotten all this information, what does this actually look like
28:35
Speaker 4: for help loans?
28:37
Speaker 5: Obviously I am stout skirl. I've done some maths because
28:42
Speaker 5: I love to do maths. I also love to stop
28:44
Speaker 5: the podcast halfway through so I can do some sly
28:46
Speaker 5: maths and come back. You guys don't have to wait,
28:49
Speaker 5: because we edit all of the waiting time out.
28:51
Speaker 4: But Beck does, so I will said patiently.
28:53
Speaker 5: You do you smile or nod, But from the first
28:56
Speaker 5: of June, most Australians with an outstanding student loan debt
28:58
Speaker 5: will actually see their balance shoot up by hundreds or
29:01
Speaker 5: even a thousands of dollars. Beck, if the indexation rate
29:04
Speaker 5: does go up by seven point one percent, So I
29:08
Speaker 5: calculated that really quickly for you. But I've got a
29:10
Speaker 5: few examples. So if you've got ten grands left on
29:12
Speaker 5: your loan, it's going to increase by seven hundred and
29:15
Speaker 5: ten dollars. For every ten thousand dollars in debt you have,
29:20
Speaker 5: it will consistently increase by seven hundred and ten thousand dollars.
29:23
Speaker 5: So if you have a twenty five thousand dollars loan balance,
29:26
Speaker 5: it would increase by seventeen hundred and seventy five dollars.
29:28
Speaker 5: Beck And if you had a fifty thousand dollars loan,
29:31
Speaker 5: it would increase by three thousand, five hundred and fifty dollars.
29:35
Speaker 5: And Beck, do you want to know how much my
29:36
Speaker 5: hex STEP's going to be increasing by? Because you know,
29:38
Speaker 5: we've been a little pervy, we're being a little personal
29:41
Speaker 5: go on. So I still have eighty thousand dollars worth
29:43
Speaker 5: of hex step, So I'm going to be slammed with
29:46
Speaker 5: five thousand, six hundred and eighty dollars worth of indexation. No,
29:50
Speaker 5: that's a trip for two to Bali.
29:52
Speaker 4: At least, yeah, at least please.
29:55
Speaker 5: But again, I feel very grateful to have that system
29:58
Speaker 5: in place, And I mean there's actually no way that
30:01
Speaker 5: I could have personally afforded to go to university and
30:03
Speaker 5: get the degrees that I have without the help and
30:05
Speaker 5: HEXT system.
30:06
Speaker 2: So am I mad that that's the case?
30:08
Speaker 4: No?
30:08
Speaker 2: Not really.
30:09
Speaker 5: I feel like it's you know, part and parcel of
30:11
Speaker 5: the system that we are using. I mean, could I
30:14
Speaker 5: be mad about it? Yeah, it's a lot of money,
30:16
Speaker 5: but again I think that I'm just trying to see
30:19
Speaker 5: it from a more positive light of like, that's the
30:21
Speaker 5: cost of you know, me being able to get to
30:24
Speaker 5: where I want to be in life, because Lord knows,
30:26
Speaker 5: I wouldn't have gotten anywhere without those degrees.
30:29
Speaker 4: Amen, Well, could you be sad about it?
30:33
Speaker 5: I could be sad about it, Like I could just
30:35
Speaker 5: be a little sad that, you know, I'm in a
30:37
Speaker 5: bit more debt. But honestly, I see my HEX debt
30:40
Speaker 5: as something that has helped me in the past few years.
30:43
Speaker 5: It has got me to where I need to go.
30:45
Speaker 5: There was a period of time where it made me
30:47
Speaker 5: feel physically sick when I logged into my portal.
30:50
Speaker 4: Because it was more don't log in.
30:51
Speaker 5: Yeah it was more than one hundred grand, and I'd
30:53
Speaker 5: be like.
30:53
Speaker 4: Whoah, who let that happen?
30:55
Speaker 5: Whose idea was that, And it's kind of like you.
30:58
Speaker 5: Right when I started my degree, I just didn't think
31:01
Speaker 5: about how much debt I was racking up, Like I
31:03
Speaker 5: was not interested in finance. We've talked about this publicly
31:06
Speaker 5: before that by the time I was twenty two, I
31:08
Speaker 5: was in like I think it was forty four thousand dollars.
31:11
Speaker 2: Worth of personal debt.
31:12
Speaker 5: Like I was really good at that, and that didn't
31:14
Speaker 5: worry me at the time until I started learning more
31:16
Speaker 5: and more about finance and I kind of was like, oh,
31:18
Speaker 5: I might need to pull my socks up. This is
31:20
Speaker 5: a lot of money. And like I got out of that.
31:23
Speaker 5: It took a lot of work and a lot of time.
31:24
Speaker 5: But it's one of those things where now things like
31:27
Speaker 5: this mean a bit more to me because I'm grateful
31:29
Speaker 5: for them. But when I took them on, I had
31:31
Speaker 5: no concept of what that would look like for me
31:33
Speaker 5: in the future.
31:34
Speaker 2: And I think a lot of people are in that circumstance.
31:36
Speaker 4: Yeah, absolutely, it is good to know that it hasn't
31:39
Speaker 4: been this high historically and hopefully won't be the case
31:42
Speaker 4: in future years.
31:44
Speaker 5: It's actually not sustainable if it was in future years, right,
31:47
Speaker 5: because if it was in future years, you're gonna be
31:50
Speaker 5: is a bit screwed, babe. Like, there's a lot more
31:52
Speaker 5: going on than help in hex debt repayments. I promise
31:56
Speaker 5: if indexation kept up at that rate, there's going to
31:58
Speaker 5: need to be some serious change and the government would
32:01
Speaker 5: get involved to promise it's okay, and.
32:02
Speaker 4: They would drown in our tears.
32:04
Speaker 5: They would, they would.
32:06
Speaker 4: So should people start trying to pay down their helped
32:09
Speaker 4: deb before the first of June, Beck.
32:11
Speaker 5: You should know better than asking a personal advice question
32:13
Speaker 5: on this podcast. This podcast is general advice only, and
32:17
Speaker 5: you shouldn't actually take my advice on anything because that
32:19
Speaker 5: would be financially irresponsible.
32:21
Speaker 2: I have a license to uphold Beck.
32:23
Speaker 4: That's fair.
32:24
Speaker 5: Now pretend, but pretend here, Okay, So there are a
32:27
Speaker 5: few things that I want you to think about. So
32:29
Speaker 5: first things first, we know that every single persons situation
32:33
Speaker 5: is different, and if you're stressing over it but you
32:35
Speaker 5: can't afford it, please stop stressing. It is what it is.
32:39
Speaker 5: Let's not stress about the things we can't change, Like,
32:41
Speaker 5: what's the point. Absolutely, if it's something that is stressing you,
32:44
Speaker 5: then maybe we can look at it in a bit
32:46
Speaker 5: more depth. But I think making sure that you're comfortable
32:49
Speaker 5: with that and you know what it means and how
32:50
Speaker 5: it works is basically what everyone can do. Whether we
32:53
Speaker 5: contribute more or not is a different conversation. But given
32:57
Speaker 5: what we've discussed, for the first time in a long, long,
32:59
Speaker 5: long time, it actually might be worth for some people
33:03
Speaker 5: to be making.
33:03
Speaker 2: Extra contributions to their HEX debt.
33:06
Speaker 5: It's something that personally, I will not be doing, and
33:09
Speaker 5: the reason I'm not doing it is because I don't
33:11
Speaker 5: need to do that to achieve the goals that I
33:13
Speaker 5: currently have. So if my goal was to buy a house,
33:16
Speaker 5: and I knew that by paying down some of my
33:18
Speaker 5: HEX debt would mean that my ability to lend more
33:21
Speaker 5: money would increase them, maybe it would be worth it
33:23
Speaker 5: for me. Maybe I could do that. But if you're
33:26
Speaker 5: in that circumstance shameless plug for Zella Money, please go.
33:30
Speaker 5: We'll put the link in the show notes to talk
33:32
Speaker 5: to one of our brokers. If you are in the
33:34
Speaker 5: position to be purchasing a house, or you think you're
33:37
Speaker 5: in the position to purchase house and you're thinking about
33:39
Speaker 5: your HEX debt repayments, go and talk to a mortgage
33:42
Speaker 5: broker so that they can look at your whole circumstance,
33:45
Speaker 5: and they can sit you down and be like, yep,
33:47
Speaker 5: back in your situation, it would do this for you,
33:49
Speaker 5: and you go, great, I will do that. Can I
33:51
Speaker 5: tell you that on a podcast? Unfortunately not. But what
33:54
Speaker 5: I can tell you is that it might change it
33:56
Speaker 5: for some people, it might not because it's going to
33:59
Speaker 5: depend how much text debt do you have, how much
34:01
Speaker 5: can you afford to repay? What is your current deposit
34:04
Speaker 5: for the home that you're looking to buy? Do you
34:06
Speaker 5: have a Garran tool loan? What do all these things
34:09
Speaker 5: actually mean for you? There's no one size fits or
34:11
Speaker 5: response to that, and I am very sorry. I wish
34:14
Speaker 5: there was. Did it make content creations so much easier?
34:16
Speaker 1: Oh?
34:17
Speaker 5: Fuck you? Just make the podcast be like all right, guys,
34:19
Speaker 5: so indexations coming out first of June. This is what
34:21
Speaker 5: we're going to do.
34:22
Speaker 4: These are the rules, These are the answers.
34:25
Speaker 5: Beck, You're going to do X and if you're not
34:27
Speaker 5: in exposition do why do? How much easier content creation
34:30
Speaker 5: would be? The community would love it? But do you
34:33
Speaker 5: know what, You've got to do some of the work yourself.
34:35
Speaker 4: Unfortunately, unfortunately, but.
34:37
Speaker 5: The girls that Zella Money can basically do that for
34:39
Speaker 5: you and kind of calculate it based on your personal circumstances. Also,
34:42
Speaker 5: they'll do it for free, so that's kind of a
34:44
Speaker 5: money we Oh my god. As I said, and I've
34:47
Speaker 5: said a million times before, I would always prioritize paying
34:51
Speaker 5: off personal debt first, so things like personal loans and
34:55
Speaker 5: credit cards and any other personal debt. I would also
34:59
Speaker 5: look at bumping up your emergency fund, because your emergency
35:02
Speaker 5: fund is going to be that fund that means that
35:04
Speaker 5: you can get out of a pickle real quick. Someone
35:07
Speaker 5: the other day called it a squirrel fund, and I
35:09
Speaker 5: thought that was real cute, because like squirrels, they're like
35:12
Speaker 5: hide away all their nuts for the winter, and then
35:14
Speaker 5: they live off their nuts in the winter when things
35:16
Speaker 5: aren't as good.
35:17
Speaker 2: That's what how emergence.
35:19
Speaker 4: That's very cute.
35:20
Speaker 5: Anyway, we want a squirrel fund. We want to make
35:22
Speaker 5: sure that we're not in any personal debt, and at
35:24
Speaker 5: that point we can consider whether making additional contributions to
35:28
Speaker 5: our hex or help debt is a good idea. Perfect Again,
35:31
Speaker 5: it's going to depend on whether you're going for a
35:33
Speaker 5: home loan or not as to whether that is worth
35:35
Speaker 5: it or you know what could just be stressing the
35:37
Speaker 5: but Jesus out of you, Beck. You could be so
35:40
Speaker 5: stressed over your heck's debt, and no matter how many
35:43
Speaker 5: times you listen to me or how many times you
35:45
Speaker 5: listen to other podcasts, it's just something that keeps you
35:48
Speaker 5: up at night. Maybe making additional contributions to something that
35:51
Speaker 5: fits within your goals makes you feel good.
35:54
Speaker 2: You do U, SIS, you do you, you do you.
35:56
Speaker 5: But what I want you to be able to do
35:58
Speaker 5: is tell me what your payments are, what they look like,
36:00
Speaker 5: how it impacts you as an individual, what it actually
36:03
Speaker 5: looks like if you paid off more debt.
36:05
Speaker 2: Because a lot of.
36:05
Speaker 5: People might go, I really need to get rid of
36:07
Speaker 5: my hex step before I get a home. That's actually
36:10
Speaker 5: not true. I bought a house with a one hundred thousand
36:13
Speaker 5: dollars worth of hex step. We work with people every
36:16
Speaker 5: single day that have very large hex stets.
36:19
Speaker 2: And still get homes.
36:20
Speaker 4: That's company.
36:21
Speaker 5: So it's really important to understand that doesn't need to
36:23
Speaker 5: be completely.
36:24
Speaker 2: Diminished before you do that.
36:26
Speaker 5: That's why I want you to talk to a broker,
36:28
Speaker 5: because the amount of people that I have spoken to
36:30
Speaker 5: that are like, oh my god, vee, like I've paid
36:31
Speaker 5: off eighty thousand dollars worth of my hex stet. I
36:34
Speaker 5: go far out, that's so sick, like, that's so good,
36:37
Speaker 5: And then they say, so I'm going to now start
36:40
Speaker 5: saving for a house, and I kind of go, oh good,
36:44
Speaker 5: smile a nod like, because there's nothing I can do
36:46
Speaker 5: about that circumstance. But in reality, if they had the
36:48
Speaker 5: capacity to pay off an eighty thousand dollars home loan,
36:51
Speaker 5: they had the capacity to save eighty thousand dollars, and
36:54
Speaker 5: they could have probably already been in a house and
36:56
Speaker 5: just started paying off their hextet a bit more now
36:59
Speaker 5: that they have the property. And obviously, when it comes
37:01
Speaker 5: to investing, the sooner you're in the market, the more
37:04
Speaker 5: time you have for compound interest to play into it.
37:06
Speaker 5: And sometimes that's the best outcome. Am I saying that
37:09
Speaker 5: that's right for every single person? No, But that's why
37:12
Speaker 5: you need to be educated, because if you're stressing about
37:15
Speaker 5: your hextet, I can almost guarantee that the reason you're
37:18
Speaker 5: stressing about it is because you don't know enough about it.
37:21
Speaker 2: You don't know the.
37:22
Speaker 5: Semantics of that hexel help debt, but you also don't
37:24
Speaker 5: know how it impacts you financially, and that makes people stressed.
37:28
Speaker 5: So talk to someone, listen to some more podcasts, go
37:31
Speaker 5: and talk to a mortgage broker about how that actually
37:34
Speaker 5: impacts you, because Beck, you know, we calculated what your
37:37
Speaker 5: hex step looks like and how much you're paying back.
37:40
Speaker 5: You're like, yeah, okay. I feel like you said yep, okay,
37:43
Speaker 5: because that was about what you expected anyway, Yes, you
37:45
Speaker 5: were fine with that, and you're also not looking into
37:48
Speaker 5: any other big goals. But would you be stressed about
37:52
Speaker 5: it if you were on the home buying process and
37:54
Speaker 5: you're like, oh, I don't know what that looks like.
37:56
Speaker 4: If I didn't know, and I guess I don't really
37:58
Speaker 4: know that much kind of do now about it.
38:01
Speaker 5: I do the whole.
38:02
Speaker 4: Podcast, but I wouldn't know the process of like buying
38:04
Speaker 4: a house very well. But the idea that you have
38:08
Speaker 4: a debt might make you stress. I think about achieving
38:10
Speaker 4: something else. I think that would probably stress me out
38:13
Speaker 4: a little bit. More money MO problems.
38:15
Speaker 5: Exactly exactly, but essentially, I guess the crux of this
38:19
Speaker 5: is I just want you guys to be educated. I
38:21
Speaker 5: hope that this has given you the level of education
38:23
Speaker 5: that you deserve, but also there are going to be
38:26
Speaker 5: a whole heap of resources on our Instagram soon.
38:28
Speaker 2: I'm probably going to.
38:29
Speaker 5: Make a whole heap of tiktoks because I keep being
38:30
Speaker 5: told off by the cheese. The TikTok well, I don't.
38:33
Speaker 5: I don't love making them, but my team keep bullying
38:35
Speaker 5: me into making more, so I will do that. But
38:38
Speaker 5: I just I want you to be in the best
38:40
Speaker 5: possible position to make the best decision for you, and
38:42
Speaker 5: that is honestly all I can do.
38:45
Speaker 4: I love that visa anything else before we shut this down?
38:49
Speaker 5: Yeah, okay, so first things first. Obviously, education is the key.
38:52
Speaker 5: I could go on about it forever. If you don't
38:55
Speaker 5: know what's going on with your HEX or help debt,
38:57
Speaker 5: you can check it through your mygove login. That's just
39:00
Speaker 5: like the Tax Officers online platform. You guys should know
39:03
Speaker 5: what my guve is. If you don't, please google it
39:05
Speaker 5: and make sure that you log into that and have
39:07
Speaker 5: a look, because that's not just got your HEX, it's
39:09
Speaker 5: got your tax information, it's got your Medicare information. It's
39:12
Speaker 5: kind of like your personal hub. The simplest way to
39:15
Speaker 5: make your repayment on Hex is actually just through bepay
39:18
Speaker 5: it's so easy.
39:19
Speaker 2: I'm not saying go do.
39:20
Speaker 5: It right now, but what I am saying is, like,
39:23
Speaker 5: I think a lot of people assume it's this really
39:25
Speaker 5: complex process. It's not. It's just a be pay for repayment,
39:28
Speaker 5: like you just transfer it like you would be transferring
39:30
Speaker 5: your mate when they bought the pizza.
39:32
Speaker 2: Easy, really easy.
39:34
Speaker 5: So if you are considering making a repayment and you're like, oh,
39:37
Speaker 5: I'm really stressed about this, or I only have a
39:39
Speaker 5: little to go rah rah, make sure you're making that
39:41
Speaker 5: repayment well before the end of May to make sure
39:44
Speaker 5: it's processed in time to avoid any additional indexation that
39:47
Speaker 5: might be applied to that. So just be in really
39:49
Speaker 5: early because when it happens, it's going to happen on
39:51
Speaker 5: the first of June, so you want to make sure
39:53
Speaker 5: that you are getting that payment in asap.
39:56
Speaker 2: If that is your plan.
39:57
Speaker 4: I love that.
39:58
Speaker 5: I'm done.
39:59
Speaker 4: Are you done?
40:00
Speaker 5: I could keep going on and on, but I think
40:02
Speaker 5: we need to be done, and I.
40:03
Speaker 4: Could keep listening.
40:04
Speaker 5: No, you couldn't.
40:05
Speaker 2: You're sick. You are so sick of me.
40:07
Speaker 4: I think it's lots of absorbed. Let's go and have
40:09
Speaker 4: a little tea. You have a little walk.
40:11
Speaker 5: We deserve Yeah, I think we deserve a treat.
40:13
Speaker 4: I think we just have a treat.
40:14
Speaker 2: Everybody deserves a treat.
40:16
Speaker 5: Have a good day.
40:16
Speaker 2: We will see you guys on Friday.
40:18
Speaker 4: See you soon bybe.
40:25
Speaker 2: The advice shared.
40:26
Speaker 3: On She's on the Money is general in nature and
40:29
Speaker 3: does not consider your individual circumstances. She's on the Money
40:32
Speaker 3: exists purely for educational purposes and should not be relied
40:36
Speaker 3: upon to make an investment or financial decision.
40:39
Speaker 5: If you do choose to buy a financial product.
40:41
Speaker 3: Read the PDS TMD and obtain appropriate financial.
40:44
Speaker 5: Advice tailored towards your needs.
40:46
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40:50
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