Speaker 1: Welcome to How Today Afford That, the podcast that peeks
Speaker 1: into the financial lives of everyday Australians. I'm Michael Thompson.
Speaker 1: I'm an author and the co host of the podcast
Speaker 1: Fear and Greed business news. As always, I am with
Speaker 1: Canna Campbell, financial planner and founder of sugar Mama TV,
Speaker 1: which is a financial literacy platform that you find pretty
Speaker 1: much everywhere YouTube, podcast, books, Instagram, threads, TikTok, keynote, speeches everywhere.
Speaker 2: Hello, Canna, good morning. How are you?
Speaker 1: I am good and I am looking forward to today
Speaker 1: because we are going to help everyone save a bit
Speaker 1: of money today.
Speaker 2: That's what we do. We're good at this.
Speaker 1: Yeah, it's a lofty goal. Every single person who's listening
Speaker 1: to this right now is going to save some money
Speaker 1: because today we are talking about the idea of a
Speaker 1: loyalty tax. We are looking at who is paying it
Speaker 1: spoiler pretty much everyone right, how much it's costing you,
Speaker 1: how to stop paying it, and most importantly, how to
Speaker 1: start saving some money. Let's get straight into it. What
Speaker 1: is a loyalty tax.
Speaker 2: So loyalty taxes where you simply pay because you've been
Speaker 2: a long term customer and I don't really want to
Speaker 2: point fingers here. But companies sometimes think that we're not
Speaker 2: going to go and check our bills or shop around
Speaker 2: for another deal, so they gradually and gently increase prices
Speaker 2: without us necessarily noticing, or they fail to let us
Speaker 2: know about any new special promotions and discounts that they
Speaker 2: might have coming up. So essentially it's a financial penalty
Speaker 2: for sticking around with one provider for too long and
Speaker 2: not actually stopping to question the actual value and whether
Speaker 2: you could be getting better value potentially elsewhere, or asking
Speaker 2: for a better deal.
Speaker 1: Okay, And so typically this is where you will see
Speaker 1: special deals being promoted for new customers and things like that,
Speaker 1: and you're like, hey, I've been with you for five
Speaker 1: years or ten years or something like, why don't I
Speaker 1: get that price that they're offering.
Speaker 2: That's not fair? I want that deal too.
Speaker 1: Now, I think there is the general assumption that this
Speaker 1: is all about banks. It is not all about banks,
Speaker 1: is it? Because there are other service providers?
Speaker 2: Yes, So look, banks probably get the first finger pointing
Speaker 2: deal when it comes to the term loyalty tax, but
Speaker 2: it's not at all just limited to banks. Insurance companies,
Speaker 2: you know, particularly personal insurance. Then there's gas and electricity,
Speaker 2: you know, gym membership subscriptions, and I remember during Frugal February,
Speaker 2: I called up my energy and gas provider, which are
Speaker 2: the same company, and within minutes I had one hundred
Speaker 2: and thirty dollars per month knocked off my plans.
Speaker 1: Did you say one hundred and thirty dollars?
Speaker 2: Yeah? Have you not been listening to any of my
Speaker 2: Frugal February results?
Speaker 1: Yes, clearly not. Yeah, so well I hadn't. I wasn't
Speaker 1: aware that the savings were so big. Yeah, that is
Speaker 1: really impressive. You mentioned insurers, right, and I want to
Speaker 1: kind of cover a whole lot of those, like gyms.
Speaker 1: I'm surprised by gyms as well. But we just stay
Speaker 1: on insurers for a moment, because everyone has some form
Speaker 1: of insurance, right, whether it's your car insurance, a health insurance,
Speaker 1: or your home insurance. You see that there is like
Speaker 1: a loyalty discount when you go to renew, you get
Speaker 1: kind of like a twenty five percent off of being
Speaker 1: a loyal customer or something. Is that then a little
Speaker 1: bit deceptive?
Speaker 2: It can be, So there's all sorts of benefits and
Speaker 2: perpose it can come with some of these insurance policies,
Speaker 2: you know, access to certain parks and entertainment and various
Speaker 2: sporting activities. But you've got to really look at what
Speaker 2: obviously what's applicable to you and whether you're going to
Speaker 2: make the most of that. So, yes, there are discounts,
Speaker 2: but there also are ones that can also encourage you
Speaker 2: to spend money where you weren't going to necessarily, so
Speaker 2: actually you can end up costing you even more, as
Speaker 2: well as the fact that it's not necessarily that competitive.
Speaker 2: A classic is you know that you see and it's
Speaker 2: not just insurance companies, even particularly retail. You know they'll
Speaker 2: have a special sale for the weekend where you spent
Speaker 2: three hundred, but you don't have to pay two hundred. Now,
Speaker 2: you may have never intended in going and spending three
Speaker 2: hundred dolls in that store, even a fifty dollars in
Speaker 2: that store, because of that offer, they've been enticed you
Speaker 2: in and to spend and do obviously partner with their
Speaker 2: colleagues and associates and partners.
Speaker 1: Okay, let's kind of go to home loans because or
Speaker 1: banks generally, but focusing on home loans, I suppose because
Speaker 1: this is probably the big one and the one that
Speaker 1: is most Look at me making assumptions here, I'm hoping
Speaker 1: this is a correct assumption that a loyalty tax on
Speaker 1: a home loan where you have been with the bank
Speaker 1: for a very long time, and you have been paying
Speaker 1: perhaps one interest rate for quite some time, and you
Speaker 1: see new customers being enticed to come over to this
Speaker 1: bank with a fantastic interest rate, and you're thinking, why
Speaker 1: aren't I getting that rate? Banks would be the one
Speaker 1: that you are paying the most on a loyalty tax, right.
Speaker 2: Look, everyone is obviously in a different situation. But yes,
Speaker 2: and I'm actually really glad you asked this question because
Speaker 2: I've answer some numbers, and the numbers are looking quite sexy.
Speaker 2: If I don't might say so myself. So if you
Speaker 2: look at say an average home loan of about five
Speaker 2: hundred thousand dollars, and you're paying on average over the
Speaker 2: life of the loan, which is typically around thirty years,
Speaker 2: around sort of six point five percent, but you then
Speaker 2: negotiate five years into six percent, that's two and a
Speaker 2: half thousand dollars a year in savings. Now, if you
Speaker 2: think about that just for a ten year period alone,
Speaker 2: that's twenty five thousand dollars. But though that potential cost
Speaker 2: all that potential savings can go even further because if
Speaker 2: you maintain your existing mortgage repayments as though they already
Speaker 2: remain at six point five, even though you're onready being
Speaker 2: charged six, you can potentially, say fifty five thousand dollars
Speaker 2: and pay off your home two and a half years
Speaker 2: off soon. So that loyalty tax is definitely not just
Speaker 2: limited to the two and a half thousand dollars per Yeah,
Speaker 2: it represents so much more. And of course, you know,
Speaker 2: paying off your home loan two and a half years
Speaker 2: earlier that those are mortgage repayments can go into super
Speaker 2: to go into investing, to go into other lifestyle requirements.
Speaker 2: So it really does pay to look at where you're
Speaker 2: potentially being overcharged.
Speaker 1: How do you know? It's all well and good to say, hey,
Speaker 1: you can do this, you can kind of get a
Speaker 1: better deal, But how do you know if you are
Speaker 1: actually paying a loyalty tax, if you are overpaying as
Speaker 1: a loyal customer.
Speaker 2: Well, one thing's for sure, they're not going to call
Speaker 2: you and tell.
Speaker 1: You they might.
Speaker 2: I think I've had one phone call like that in
Speaker 2: my whole entire life.
Speaker 1: Really, what was it?
Speaker 2: It was? I think it maybe be in Foxtell yep,
Speaker 2: And that was probably because I was threatened to leave.
Speaker 1: But so slightly different scenario.
Speaker 2: And I will admit my mortgage broker every year, if
Speaker 2: not twice a year, he will call the bank on
Speaker 2: my behalf okay, And he will then call me and say, hey,
Speaker 2: just letting you know, I've just negotiated X basis points
Speaker 2: off your home loan has already been applied. Just you'll
Speaker 2: see those repayments coming down if you want to maintain them. So, yes,
Speaker 2: I have seen it. But unfortunately, because these institutions play
Speaker 2: you know know what we're like, we they won't go
Speaker 2: and give it to us. We have to go and
Speaker 2: find it ourselves. We need to arm ourselves with the
Speaker 2: right type of information, do our research, know our numbers,
Speaker 2: and then have the confidence to pick up the phone,
Speaker 2: call the phone and say, hey, I think we need
Speaker 2: to have a little chat.
Speaker 1: In a minute. We're going to go through what you
Speaker 1: should say on the phone, almost a little bit of
Speaker 1: a script. We could just role play, role play play.
Speaker 1: Are you going to be the customer and I'll be
Speaker 1: the banker?
Speaker 2: Why I want to be the customer. I'm going to
Speaker 2: be hustling up a better deal.
Speaker 1: Okay, and I will be the service provider, maybe the
Speaker 1: gas provider.
Speaker 2: I was thinking we could do the bank because most
Speaker 2: people like to call their banks. That's the biggest savings.
Speaker 2: Come on, we're all about maximizing our savings here. Let's
Speaker 2: work efficiently. Go for the low hanging fruit here, Michael, So.
Speaker 1: Well, okay, look, shall we can I just touch on
Speaker 1: the how you know you are paying a loyalty tax?
Speaker 1: So first, because we talked about the fact they're not
Speaker 1: going to call you up, you need to be checking
Speaker 1: this yourself. Is it a case of say, with your
Speaker 1: home loan, logging in to your bank account, seeing what
Speaker 1: the home loan rate is that you're currently paying, going
Speaker 1: to the bank website and seeing what the comparison rate
Speaker 1: is or what the introductory rate is for new customers,
Speaker 1: and going, hey, that's less.
Speaker 2: Yes, that's only half the story though. Half the job
Speaker 2: you there need to go and have a look at
Speaker 2: what the competition is offering.
Speaker 1: Okay, and that will tell you whether you're overpaying essentially,
Speaker 1: or just whether you have fallen victim to a loyalty
Speaker 1: tax exactly. Okay, why do you reckon people stay for
Speaker 1: so long? Is it laziness? Is it complacency? Is it
Speaker 1: just the fact that everyone we are all so busy
Speaker 1: and this takes time.
Speaker 2: I think it's three things. I think, as you said,
Speaker 2: life gets really busy, and unless we are sort of
Speaker 2: backed into a corner and forced to actually review our bills,
Speaker 2: like doing Frugal February, we need that trigger or that
Speaker 2: financial crisis in our life to actually make us pick
Speaker 2: up the phone or look at our bills or look
Speaker 2: at our budgets and go all right, something something's got
Speaker 2: to give here, like even an interest rate hike. But
Speaker 2: then there's also the psychological factor. So a lot of
Speaker 2: us assume that we're being taken care of because we're
Speaker 2: being so loyal to our bank, to our gas provider
Speaker 2: or energy provider, so we assume that we're going to
Speaker 2: be We've being rewarded. Of course, we're on the best deal.
Speaker 2: I've been with my bank for twelve years. Why would
Speaker 2: they jeopardize, you know, damaging, and we're hourting and we
Speaker 2: are overcharging. It's just ridiculous. So we kind of paint
Speaker 2: this false sense of reality, but unfortunately it's not quite
Speaker 2: as simplistic as that, and a little bit naive to
Speaker 2: think like that. And then, of course, I think for
Speaker 2: a lot of people is we feel completely overwhelmed, particularly
Speaker 2: right now, with the idea of having to pick up
Speaker 2: the phone have that awkward, sometimes uncomfor comfortable conversation that
Speaker 2: does actually require you to actually do a little bit
Speaker 2: of groundwork beforehand and then ask for something that we
Speaker 2: don't necessarily fully grasp or understand the actual work involved,
Speaker 2: and if it's even possible, so we could very easily
Speaker 2: put it to the bottom of bileist things to do
Speaker 2: and it never ever gets done. And I have shared
Speaker 2: which I'm really hoping you remember this as a little
Speaker 2: hack for people who are feeling overwhelmed make that phone call.
Speaker 2: To try and make it as easy as possible is
Speaker 2: have the telephone numbers in your phone saved, but in
Speaker 2: the notes section, or even in the notes attached to
Speaker 2: that contact, you have your policy numbers, or your homelow numbers,
Speaker 2: or your customer service numbers, so that when you do
Speaker 2: get someone who answers the phone, you've actually got a
Speaker 2: lot of information that they can look up on your
Speaker 2: behalf to get the conversation going.
Speaker 1: Yeah, and you can do it while they're sitting in
Speaker 1: the car park waiting for someone or something like that.
Speaker 1: You can make the most of those little moments of
Speaker 1: downtime exactly.
Speaker 2: And it just specially when you're sitting there thinking I've
Speaker 2: got to do it. And this is my newest real
Speaker 2: solution is stop thinking about it. Just get it done
Speaker 2: while you can. I'll forget about it all evaporate. So
Speaker 2: I think you know, being on the front foot with
Speaker 2: loyalty tax is really important. And the longer it drags on,
Speaker 2: the bigger the cost to you. And you know we're
Speaker 2: all on type budgets right now. Every dollar counts, So
Speaker 2: cut the excuses, do some research and make those phone calls,
Speaker 2: which will explain in a second.
Speaker 1: Okay, we will take a break, and then we're going
Speaker 1: to talk about the information that you need to gather
Speaker 1: to make these calls. And then and then a role play.
Speaker 1: Very excited about this cana. We are talking about loyalty
Speaker 1: taxes today. This is essentially the idea that you are
Speaker 1: overpaying with a provider of some kind, whether it's your
Speaker 1: bank with your home loan, or your gas, your utilities
Speaker 1: providing your water, anything along those lines. Insurance gyms that
Speaker 1: you have been there for long enough that really you're
Speaker 1: kind of being left behind. There are better offers out
Speaker 1: there and you could getting a better price, And this
Speaker 1: is all about how to get that better price. For
Speaker 1: you to make that call though, to ring up and
Speaker 1: say I want a better deal, what information do you
Speaker 1: need to have in place? You mentioned before, just the
Speaker 1: basics of having your policy numbers and all those kinds
Speaker 1: of things, But surely you also need those some a
Speaker 1: bit of leverage to say I'm getting I could get
Speaker 1: a better deal over at this other place.
Speaker 2: Yes, you are spot on, So the more information you
Speaker 2: have the better. So preparation is key here. Don't just
Speaker 2: jump on the phone because you could end up wasting
Speaker 2: quite a bit of time. So what I recommend you
Speaker 2: do is go and jump on your internet banking and
Speaker 2: look at the interest rate that you are paying. It
Speaker 2: should be clearly marked. Also check and see if there
Speaker 2: is a discount that's been applied. I know in the
Speaker 2: past I've looked at my home loan rate and fookoh,
Speaker 2: I can't believe in paying that. But then I've looked
Speaker 2: a few lines down and there's actually a discount on
Speaker 2: that rate. So make sure you have an accurate amount
Speaker 2: of information about what you really are paying. Also things
Speaker 2: that are really important that you can use your advantage,
Speaker 2: obviously knowing how long you've been with your bank for
Speaker 2: your financial institution and how much you've paid off. And
Speaker 2: of course if you have a good repayment history, you've
Speaker 2: never defaulted, there's never been any late payments, any awkward
Speaker 2: phone calls. You've got a good standing, solid history and
Speaker 2: not only being a loyal customer but also being a
Speaker 2: very responsible, reliable one. Then you also want to go
Speaker 2: and have a low because you mentioned see what they're
Speaker 2: offering new customers and see what if there's any particular
Speaker 2: terms and conditions, because whilst it may look like a
Speaker 2: brilliant honeymoon rate, there could be some final details that
Speaker 2: it's until you go digging, you go, actually that's not
Speaker 2: really that good.
Speaker 1: Adeal because they can often be introductory rates because it
Speaker 1: might only be for say six months or twelve months,
Speaker 1: and you are talking in the case of a homelane,
Speaker 1: you're talking kind of twenty five plus.
Speaker 2: Years exactly, and it may revert to something that's actually
Speaker 2: higher than what you are paying. So it's worth doing
Speaker 2: your research. Then of course you go and look at
Speaker 2: what the competition is paying. What's another institution offering to
Speaker 2: move your loans over to them? Have everything written down
Speaker 2: and make sure you've written it down so you can
Speaker 2: refer to it so you can say bank X y
Speaker 2: Z now offering this, bank ABC or offering that, so
Speaker 2: that they know you are serious, You've done your research,
Speaker 2: and this is not a conversation to be fobbed off.
Speaker 2: The bank would necessarily do that, but you go to
Speaker 2: come across a lot more. You're gonna be taken more
Speaker 2: seriously and you're gonna have a lot more productive conversation.
Speaker 2: So then when you've got all of that information, you
Speaker 2: can now call the bank and you are literally it's
Speaker 2: not all guns blazing, but you can say like you're
Speaker 2: a miss, like pitching yourself as I deserve more me time,
Speaker 2: like I want a better deal on my on my
Speaker 2: home loan. And that is when you get the balls rolling.
Speaker 2: And this is where you can see where it all lands.
Speaker 1: Is it time?
Speaker 2: It is time?
Speaker 1: It's time for the role play.
Speaker 2: That's wrong.
Speaker 1: Okay, I say you are the customer customer, and I
Speaker 1: am the bank employee, and I'm very nice because I've
Speaker 1: just come back from holidays as the bank employ I'm
Speaker 1: really getting into my character here, and you know what,
Speaker 1: I'm feeling refreshed, I'm recharged. I'm looking forward to this
Speaker 1: conversation with my customer.
Speaker 2: Okay, I'll be gentle.
Speaker 1: Okay, ring ring ring, green ring, green ring ring, and
Speaker 1: I'll pick up quite quickly. Hello, welcome to the Homeland's Department.
Speaker 2: This is Steve Hi, Steve, how are you today?
Speaker 1: Very well? Thanks? Can I start with your name? Please?
Speaker 2: Absolutely? Canna Campbell?
Speaker 1: Okay, Canna, just looking up and you're having a good.
Speaker 2: Day, Cannah, I am.
Speaker 1: Thank you for asking, and I've got your number here,
Speaker 1: which I won't give out on the phone for for
Speaker 1: security reasons. Let's just assume that we've done all the
Speaker 1: security checks. I just realized we could have a few
Speaker 1: security preachers here. But what can I do for you today, Cannah.
Speaker 2: So I've actually been a customer of this fine institution
Speaker 2: for about eleven years now.
Speaker 1: I can see that you've been with us for a
Speaker 1: long time.
Speaker 2: Yes, yes, very loyal, and I am just doing a
Speaker 2: bit of a budget revamp and I'm looking to save
Speaker 2: some money because says you can tell the country things
Speaker 2: are quite tight right now. I just wondering about the
Speaker 2: interest rate that I'm paying. It looks like i'm paying
Speaker 2: this and I have been making all my repayments. I've
Speaker 2: been withins with you, but eleven years I've made extra repayments.
Speaker 2: My home is worth and I sorry I should have
Speaker 2: mentioned you should get the valuation of your home as well,
Speaker 2: and obviously you know how much you ope. But I've
Speaker 2: just done a quick check on the house dot com
Speaker 2: and my home's actually gone up in values of a
Speaker 2: lot of equity. My loan has come down because I've
Speaker 2: always made sure I stuck to my repayments and made
Speaker 2: ad hoc repayments here and there. So I'm doing really well.
Speaker 2: I'm a good customer. But what's got me going? And
Speaker 2: the purpose for this call is I think there are
Speaker 2: better interest rates out there, and I noticed on your
Speaker 2: website you're offering new customers fifty bases points less than
Speaker 2: what I'm currently paying. So can we have a chat,
Speaker 2: And if you can't help me, would you mind popping
Speaker 2: me through to somebody that can.
Speaker 1: Look. I'm certain I can help you, and you've clearly
Speaker 1: done your research. You must listen two podcasts.
Speaker 2: Oh how do they thought that's one of my favorites.
Speaker 1: Actually, oh, well there you go. Look, yes, I can
Speaker 1: see here you have been with us for eleven years
Speaker 1: and you're currently paying this amount, and look, I'm just
Speaker 1: gonna pop you on hold. I'll just go and see
Speaker 1: what I can do.
Speaker 2: Well, whilst you're at it, before you go, I did
Speaker 2: also notice that bank x y Z actually have an
Speaker 2: even better offer.
Speaker 1: Well, then, yes, you're getting out of it that quickly.
Speaker 1: I was trying to put you on hold straight away.
Speaker 1: I'm going to I'm going to go talk to my
Speaker 1: manager and see what I can do here in that scenario. Sorry,
Speaker 1: I've just stepped out of Steve's character for a moment.
Speaker 1: Is there a risk that they will say because retaining
Speaker 1: your customer is going to be their number one priority?
Speaker 2: Right?
Speaker 1: Yes? Okay, so they're not going to say you can
Speaker 1: comfortably say look, I can see like Bank XYZ is
Speaker 1: offering this. There's no risk that good old Steve over
Speaker 1: here is going to say, on your bike, head on
Speaker 1: over to x y Z.
Speaker 2: Then well they're not going to say on your bike,
Speaker 2: but they're just going to say, no, we can't match
Speaker 2: that rate, and well we can't beat that rate.
Speaker 1: Okay, So you've.
Speaker 2: Got nothing to lose from this phone call? Okay, and
Speaker 2: I am my apologies. I should have mentioned you do need.
Speaker 2: It does help a lot if you have the valuation
Speaker 2: of your home or property with you, and you can
Speaker 2: get it from for free, very quickly, on a website
Speaker 2: called onthhouse dot com dot Are you okay?
Speaker 1: All right? Okay, I'm coming back in here, Steve. You
Speaker 1: thanks for holding.
Speaker 2: There, Canna, Oh, thank you, no problem, had you go.
Speaker 1: I've had a chat and look, and yes, you've been
Speaker 1: with us for eleven years? Are you paying this amount?
Speaker 1: And look, while the interest rate that you quoted is
Speaker 1: an introductory price for new customers, we will be able to,
Speaker 1: based on the amount of time that you've been with us,
Speaker 1: lower your standard your variable rate by fifty basis points.
Speaker 2: How does that sound? That sounds great, and thank you
Speaker 2: so much. But I was actually looking at you hoping
Speaker 2: hopefully being able to beat the rate. It's great to
Speaker 2: match it, but I'd like it to be beaten because,
Speaker 2: as I said, across the road, they're offering a better
Speaker 2: rate than what you're reduce rates.
Speaker 1: All right, I'm just going to pop you back on hold, Canna,
Speaker 1: I do never want to be on the other end
Speaker 1: of a call from you because this is I thought,
Speaker 1: fifty basis points. I would have you across the line
Speaker 1: just there.
Speaker 2: So this is my point. Yeah, and this is a
Speaker 2: really important one. Don't settle.
Speaker 1: Okay.
Speaker 2: Also that's marriage advice as well, coming from someone who
Speaker 2: has a few divorces, obviously, demgate relationship advice fer actually
Speaker 2: financial yes, relationship know, but don't settle. Don't go you
Speaker 2: know what, that's good enough for me, That's fine. Don't
Speaker 2: that's that's lazy. No, if you can still get a
Speaker 2: better rate somewhere else, continue on with that research and investigation.
Speaker 2: Don't just stop at that, because there is still I mean,
Speaker 2: as I've just demonstrated, you could potentially save by fifty
Speaker 2: basis points over the course of a twenty five year
Speaker 2: loan five years in fifty five thousand dollars and pay
Speaker 2: for your home loan two and a half years earlier.
Speaker 2: So hang on, don't just stop and settle at that
Speaker 2: that you know, the fifty basis points. If you could
Speaker 2: get it further, that discome bigot. Go go and apply it.
Speaker 2: But you would accept it with gracious open arms. But
Speaker 2: you go thank you so much. That's great, and they
Speaker 2: will typically tend to apply it reasonably quickly, and you
Speaker 2: don't there's not too much paperwork involt. However, you don't
Speaker 2: necessarily stop there. You keep going and you go and
Speaker 2: this is where you go and speak to a mortgage
Speaker 2: broker and say, hey, they did reduce my rate, They've
Speaker 2: done a good deal for me, but I'm still a
Speaker 2: little bit irritated that they haven't matched the rate or
Speaker 2: beat the competition.
Speaker 1: Okay, And is there room to move on other things
Speaker 1: as well? Like you're calling up and you've just asked
Speaker 1: good old Steve just for a reduction in the rate,
Speaker 1: but say you were paying, say a mortgage package fee
Speaker 1: or something like that, can you kind of argue to
Speaker 1: get that down?
Speaker 2: Absolutely definitely. And again this is why mortgage broker is
Speaker 2: really good because they know those finer details that they'll know, Okay,
Speaker 2: you're paying a four hundred and fifty dollars annual fee
Speaker 2: or you're paying this card fee. They will go in
Speaker 2: and know those things which you may have not necessarily
Speaker 2: thought of when you're making that conversation because you're purely
Speaker 2: focused on, you know, the top line rate. So yes,
Speaker 2: these are things that can be definitely added in, and
Speaker 2: they're often the sort of last things that they will
Speaker 2: add in if they think they're going to lose you.
Speaker 1: Okay, all right, so Steve's back. Can are you still there?
Speaker 2: Yes? I most definitely am.
Speaker 1: Look you you really have done your research, and look,
Speaker 1: we can match the deal that you have seen elsewhere
Speaker 1: and which will be a further twenty basis point reduction.
Speaker 1: But you will need to give me a shout out
Speaker 1: on your podcast.
Speaker 2: Step No, probably, all right, there we go.
Speaker 1: I'm sure they're not going to attach conditions or something
Speaker 1: to it like that. I'm just like, oh, there's got
Speaker 1: to be a cat to you. I'm like, no, I
Speaker 1: don't think there would be. It would just be you
Speaker 1: have been a loyal customer, you have done your research,
Speaker 1: and that's the key that you have gone in there.
Speaker 1: You've shown them what you can get elsewhere. You've established
Speaker 1: the value of your property. You've established that you have
Speaker 1: built up additional equity in your property, and that you
Speaker 1: are deserving of a reduction. Other there is a chance
Speaker 1: that they might lose you as a customer.
Speaker 2: And even if you do, hear no, if Steve I
Speaker 2: was to go, you know, what, I'm actually going to
Speaker 2: find it even better deal. I'm going to get in
Speaker 2: touch with a mortgage broker and or do my own
Speaker 2: research and find somewhere even better. Even though I've accepted
Speaker 2: your rate, you can still the answer is still not
Speaker 2: know because when you do go to sign with another bank,
Speaker 2: your original bank will call you from the retention team
Speaker 2: and you will have a senior management manager on the
Speaker 2: phone asking you why are you leaving us? What can
Speaker 2: we do to keep you? I actually had this conversation
Speaker 2: with a bank about six weeks ago, and I spent
Speaker 2: twenty minutes on the phone. She's like, what can we
Speaker 2: do to keep your business? You've been with us a
Speaker 2: long time. We really don't want you to go. And
Speaker 2: it was fascinating hearing her talk. And she said, the
Speaker 2: moment this situation is changed, we want to get you
Speaker 2: back on board and reshift your loan back over like
Speaker 2: it was really interesting. She was willing to do lots
Speaker 2: of things. Unfortunately, was too little, too late. It was
Speaker 2: the problem. But you know, even if you hear no,
Speaker 2: we're not going to do that, it's not until it
Speaker 2: comes to crunch time you'll you never know what rabbits
Speaker 2: can be pulled out of hats by the banking institutions.
Speaker 1: If that conversation with good old Steve had gone in
Speaker 1: a different direction where okay, it's come back and offered
Speaker 1: you the fifty basis point reduction, right, and then you've said, look,
Speaker 1: that's great, thank you very much. I accept that, but
Speaker 1: can he go further? He goes off, comes back, and
Speaker 1: all of a sudden he says, look, that is the
Speaker 1: best we're going to be able to do. That is
Speaker 1: a really competitive rate that we've offered to you in
Speaker 1: recognition of the long time that you spent with us
Speaker 1: here at the bank, and we hope that that will
Speaker 1: be satisfactory to you. What do you say?
Speaker 2: Then? Again, you say thank you? And I mean that's
Speaker 2: a huge, huge interest rate savings.
Speaker 1: Yeah, I did, I did. I did right by.
Speaker 2: You, Steve. But you still if you know that there
Speaker 2: are better deals out there, again like, don't settle you
Speaker 2: you you know it is your money, your life, and
Speaker 2: you're right to the best deal possible, so accept it.
Speaker 2: As I said, don't settle. Do research. And this is
Speaker 2: where a mortgage broker is so helpful because they can
Speaker 2: actually look at do a much deeper dive and they
Speaker 2: actually could say, look, your credit report is not as
Speaker 2: squeaky clean as you may have thought. You're actually on
Speaker 2: a really good rate, and if you were to save
Speaker 2: some money, it's actually a very very small amount of
Speaker 2: money and not worth the hassle of moving. Or they'll
Speaker 2: run the numbers for you. They will let you know,
Speaker 2: and this is the value of a really good quality
Speaker 2: mortgage broker. And you want to make sure that these
Speaker 2: savings really count. And I'm going to chime in my
Speaker 2: financial planning general advice here. When you see those mortgage
Speaker 2: repayments reduced from your new flashy lower interest rate, if
Speaker 2: you can make those savings count, don't let the lifestyle
Speaker 2: creep kick in or dominate and destroy those savings. Try
Speaker 2: if you can, if your budget allows, and obviously not
Speaker 2: everyone can, and it's been very tight for all of us,
Speaker 2: try and maintain at least some of those mortgage repayments
Speaker 2: so you can actually see that true impact act of
Speaker 2: your loyalty tax slashing.
Speaker 1: Okay, and so finishing up that phone call, you would
Speaker 1: just accept it, and you don't actually need to kind
Speaker 1: of say, yeah, that's great, but I reckon, I can
Speaker 1: still get a better deal. You can just accept it
Speaker 1: and hang up the phone and come back and have
Speaker 1: another crack after you've done further research.
Speaker 2: Right exactly, except that because you want to bank those
Speaker 2: savings straight away, you don't cut your nose off to
Speaker 2: spain face. Fine, don't bother giving me that interests rate cut?
Speaker 1: I hate you, Steve.
Speaker 2: The back of the garden. No, take it, work with it,
Speaker 2: build from there, and then then you've got great negotiating power.
Speaker 2: Go to another institution going, hey, my bank charges me this.
Speaker 2: Can you go in further with that? Because obviously it's
Speaker 2: a tighter cut.
Speaker 1: Do you reckon? When your call comes into a call center,
Speaker 1: everyone's like, Canna's calling.
Speaker 2: Who's February?
Speaker 1: They're hearing this week?
Speaker 2: Yeah, my number comes up on a big dashboard like flashing.
Speaker 1: One last final question. Because Steve has done you sent
Speaker 1: him on stress leave now after your call? Are the
Speaker 1: downsides to switching providers? And you kind of flagged one
Speaker 1: of the fact that the rate might not actually be
Speaker 1: as good as it looks, that it might be an
Speaker 1: introductory one. But is there an any other downsides we
Speaker 1: need to be aware of?
Speaker 2: Yes, there are lots. So sometimes you know, if you
Speaker 2: do refinance to a new institution, or even have to
Speaker 2: accept a certain condition of your existing bank. Sometimes they
Speaker 2: will reduce limits if you have a large amount of
Speaker 2: money in an officet account or a regional facility. As
Speaker 2: part of the terms and conditions, they might say, look,
Speaker 2: you've got all the sexist funds here, can we reduce
Speaker 2: the limit. So this is again why a mortgage brokers
Speaker 2: is very, very helpful. Also, I had a situation where
Speaker 2: this was the refinancing call from six weeks ago. The
Speaker 2: new internet banking is not as intuitive, it's very clunky,
Speaker 2: it's very eighties, and it is a little bit frustrating,
Speaker 2: but obviously the benefits are there so you and then
Speaker 2: of course there are all those other can you know,
Speaker 2: all the bells and whistles sometimes actually can end up
Speaker 2: costing you more, but some people are happy to spend
Speaker 2: more because it helps them stay focused and paying off
Speaker 2: their homelan and all those wonderful budgeting tools that often
Speaker 2: come with internet banking these days with your home and
Speaker 2: they can be very valuable, and you can lose those insights.
Speaker 2: So there are definitely things you can potentially disadvantages in refinancing,
Speaker 2: but a mortgage broker will talk you through these things
Speaker 2: before you sun the dotted line.
Speaker 1: Okay, I think we've done a fairly comprehensive job of
Speaker 1: going through loyalty taxes. And I didn't realize I was
Speaker 1: hoping I would get to be the customer in the sorry,
Speaker 1: so I was not prepared to be Steve today. But look,
Speaker 1: you know what, I think we've delivered a valuable blueprint
Speaker 1: for those kinds of conversations. If anybody wants further information
Speaker 1: from you, where do they find you?
Speaker 2: The best basic in contact with me is actually at
Speaker 2: Canna Campbell Official because unfortunately in my Instagram account Sugar
Speaker 2: ma My TV has been jammed up with the Erotic
Speaker 2: variety messages, so I can't actually look at my inboxes.
Speaker 2: So if you need to get a hold of me,
Speaker 2: message me through Instagram at Canna Campbell Official, not Sugar
Speaker 2: Mama TV because I just can't bring myself to look
Speaker 2: at my inbox.
Speaker 1: Then alright, If.
Speaker 2: Anyone has any advice, let me know how to get
Speaker 2: rid of this problem.
Speaker 1: Cheapers and you can hear me every day with Sean
Speaker 1: Aylmer on Fear and Greed, daily business news for people
Speaker 1: who make their own decisions. Thank you for listening. To
Speaker 1: how do they afford that? Remember it hit follow on
Speaker 1: the podcast, and the very best thing that you can
Speaker 1: do is tell somebody else, send them the link to
Speaker 1: this episode and spread the word about how to do
Speaker 1: they afford that? Thank you very much for your company.
Speaker 1: Join us again next week.