Do you trust your bank?
That’s what ASIC is telling us NOT to do, at least for those with a mortgage offset account.
The corporate watchdog did some digging into whether banks are managing offsets properly, and the findings are grim. They uncovered 250,000 unlinked accounts, forcing banks to pay out $55 million in compensation so far — and it could be just the tip of the iceberg.
If you’ve got one of the 1.8 million mortgages with an offset, you need to check it’s linked.
Our step-by-step guide on how to check is here.
It’s a job we shouldn’t have to do. We should be able to trust our bank to do what we’re paying them for, especially since offset accounts typically come with higher fees, and in some cases, higher interest rates. (Side note: 45% of lenders offer offsets on their lowest-rate loans, so while you’re checking, make sure you aren't overpaying for the privilege.)
For those who are mortgage free, the news this week is that competition is heating up with ING launching a new 6% savings rate. A rate starting with a 6 right now is huge, but it comes with a massive catch: it’s a four-month honeymoon deal.
Consider it a reminder that most savings accounts are covered in fine print and picking one that fits your finances, and your lifestyle, is critical. If your money is sitting in a savings account today, it should be earning at least 5 per cent — every single month.
