May 9, 2023 • 41 mins
HECS or HELP debt has long been described as “the best debt you can have” BUT is this still the case? With indexation on HECS/HELP set to increase on June 1st to 7.1%, what does this mean for people with this debt? Today we are getting the downlow on HECS/HELP debt and indexation, what debt we should prioritise paying off and so much more!
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Hello, my name's Santasha Nabananga Bamblet. I'm a proud yr
the Order Kerni Whoalbury and a waddery woman. And before
we get started on She's on the Money podcast, I
would like to acknowledge the traditional custodians of the land
of which this podcast is recorded on a wondery country,
acknowledging the elders, the ancestors and the next generation coming
(00:22):
through as this podcast is about connecting, empowering, knowledge sharing
and the storytelling of you to make a difference for
today and lasting impact for tomorrow.
Speaker 2 (00:33):
Let's get into it.
Speaker 3 (00:34):
She's on the Money, She's on the Money.
Speaker 4 (00:57):
Hello, and welcome to She's on the Money, the podcast
for millennials who want financial freedom, hex or help. Debt
has long been described as the best debt you can have. Debatable,
it's very debatable, debatable, but still described it as that
who described Is it still the case just producer.
Speaker 2 (01:17):
Or was it the internet?
Speaker 4 (01:19):
Look, I think that it's both of those things probably,
But listen, as you said before we started recording this
v let's baby, I think we should really got helped
it Now though it helped it or hextet, what's the.
Speaker 2 (01:33):
They're they're same. They're the same, so I will probably
accidentally call it hex interchangeably. So HEX is for those
of us who are elder millennials, and we had Hex's debt,
but it has since been updated to be called just
across the board help debt helped. It sounds more cute,
does it. I think it's kind of crue anyway. I don't.
I don't care what it's called. I'm just mad that
(01:54):
I can't make X jokes.
Speaker 4 (01:56):
Isn't as as a sexy though, that's not that's for sure.
But we are talking about this because we have been
getting so many messages, six.
Speaker 2 (02:04):
Million of them, six fi million to be exact. I
would never overestimate either.
Speaker 4 (02:09):
Oh no, certainly not. We don't do that here at
Che's on.
Speaker 2 (02:12):
Them, absolutely not.
Speaker 4 (02:13):
So how scared should we be of headlines like he's indexation,
everything's rising?
Speaker 2 (02:20):
Well, I don't know. Well, it makes sense that we've
been getting so many messages, right because we are hearing
all through the news that on the first of June
HEX is going to be indexed by seven point one percent.
And I guess today is the day that we are
going to be talking about that, because it is wild
and when I just need to make sure that everyone
is aware that I do mean the first of June,
not the thirtieth of June, because a few people have
(02:42):
messaged me because I was on Instagram Stories just like
talking about it the other day and they're like, oh,
don't you mean the thirtieth of June when you know
end of financial year happens. No, this happens on the
first of June, ahead of the end of financial year,
so that in a month, basically, in the next thirty days,
they can calculate what your repayments were be with the
new level of indexation and can hit the ground running
(03:03):
from the first of July basically. So I'm not wrong.
I just feel the need to, like, you know, back
myself a little bit and be like, this is why
I'm correct. But also people were right to slide into
my dams because I'm consistently wrong. So if you would
like to correct me, you are more than welcome to
so don't. Yeah, I feel like a diep when I
correct myself, right, Sure, I just feel a little bit
rude when I'm like, I was right. I know it is.
Speaker 4 (03:26):
It is a bit awkward when you have to be
like Oh, actually, I did.
Speaker 2 (03:29):
I think this is the correct Yeah. Like, actually, I
don't know if you know this, but like I'm really
into finance, like really really into finance. And while I
might get dates wrong consistently, if it was the thirtieth
of June, I would know because that's my birthday. Oh
thirty is the June's your birthday? That end of July? Yes, sexy,
I'm an end of financial year baby. Is there a
(03:49):
better date for thirday in the year than the thirtieth
of June. I hope you get a big chunk of
return for your birthday? No, I always end up owing money.
It is actually a joke, is okay? Thank you for
tho as well wishes though. Let's talk about debt.
Speaker 4 (04:04):
So you've probably heard on the news the term student
debt avalanche.
Speaker 2 (04:10):
It's dramatic, isn't it. It seems dramatic.
Speaker 4 (04:12):
And I'm also like, I'm not yet scared, but like
should I be scared?
Speaker 2 (04:16):
Whyren't you scared? I just stowed a headline that they're
trying to make you scared, and you're still like, nah,
take it, take it.
Speaker 4 (04:23):
I can take it, because like to me, I feel
like avalanche.
Speaker 2 (04:25):
That's nothing. It's thirty bucks a month.
Speaker 4 (04:28):
I'm like, I don't really mind, to be honest, but like,
should I be more worried about we should?
Speaker 2 (04:33):
I mean, at the end of the day, when they're
talking about the student debt avalanche, it is proposed that
on the first of June, the student debt here in
Australia on the first of June is going to increase
by five billion dollars this year because of that seven
point one level of indexation. So that's a lot of money.
And I mean for you, you might go whatever, it's
thirty bucks, but to a lot of people, thirty bucks
(04:53):
is a lot of money. And when you're paying back
your HEX debt, especially if you're on a lower income
and you're not maybe you know, in one of those
high marginal tax brackets, but you're in the bracket where
you're starting to pay back your debt, it just feels
like it stacks on a little bit, like it genuinely
feels like you're getting nowhere. And I mean you are,
I promise, but it just feels like you're going backwards.
And I think that there's just this I don't know,
(05:14):
it's just a unspoken concept of hex versus help that
it's there to help you, and it feels like you're
kind of being kicked while you're down. Like you already
have hex debt, You already see it on your pay
slip coming out. You already know that that's money that's
not going into your back pocket. We know how we
feel about debt in general. Yes, we've spoken about the
(05:35):
difference between good, bad, and okay debt here on the podcast.
But I just feel like we're all just a little
bit salty with indexation because for so long we've just
talked about how hex slash help debt doesn't have an
interest rate associated with it, Right, So when you hear
that Beck, you smile and nod, go yeah great, but
it is indexed, So it kind of feels like we're
being kicked while we're down. Does that make sense? Kind of?
Speaker 4 (05:58):
But I guess, like what my estion is is what
is indexation and what are the basics of it?
Speaker 2 (06:05):
Stunning question. So indexation basically just means an adjustment to
a price or a wage or other value based on
the changes in other prices or a composite indicator of prices. Right,
So we spoke about it a couple of weeks ago
on the podcast where indexation is basically how much something
increases in value over time. And my favorite example of this,
(06:25):
which I didn't give you a saved it for this podcast,
the maccas cone. Oh Maca's ice cream cone? Right, yes, So, like,
do you remember back in the day. I don't know
if you ever had this luxury, but my mum would
give me a fifty cent coin silver, it was silver.
I don't know if anyone sin silver coins these days
(06:46):
because they can't buy you anything anymore. But I get
a fifty cent cone from macis.
Speaker 4 (06:51):
I actually remember when they were thirty cent.
Speaker 2 (06:53):
I feel like they went twenty cents. I feel like
twenty twenty. But last time I spoke about that publicly,
everyone was like, they are fifty cents. Was going to
call it fifty cents, right, So I do remember, probably
late primary school I was paying fifty cents for a
Maca's cone. After school we go to swimming lessons and
then we get a Maca's cone. Is like our treat,
little treaty treat for you know, going to swimming lessons,
(07:14):
as though it's not already a privilege to go to
swimming lessons, like Victoria Devine. Anyway, you're right. I feel
like it used to be twenty cents at some point,
but this is beyond the point. It is now what
like a dollar fifty? A dollar fifty, I think it's
like more than a dollar. Oh, blow me down. I
feel like in different locations around Australia, somewhere you're going
to say, oh, they're a dollar, somewhere else they're like
a dollar fifty. Right, Okay, so that has increased in
(07:36):
price over time. But are you getting the same product, beck,
I would say, identical product, identity. It's just nowadays it
costs more to produce. It's going to be more expensive.
So the dollar that you used to have back in
nineteen ninety eight, when I was seven years old and
going to swimming lessons and paying twenty cents for a cone,
I could have bought five of those ice cream cones
(07:57):
for a dollar. But today, if I gave you a dollar,
you could only buy one, and in some locations you
wouldn't even be able to buy one. You need another
fifty cents to get there. Right, So a dollar today
is not worth what a dollar tomorrow is worth. And
that's what that saying means. So indexation is that increase
in price. So it's the difference of going from twenty
cents to a dollar and you kind of don't get
(08:19):
any more value out of that product. You're still getting
the Maca's cone. There's actually no more value. It's not
any better today than it was back then because it's
probably the same recipe. So like nothing has changed about
it except the price. And that's what inflation is. It
just means that a dollar back then was actually quote
worth more because you could buy more with that dollar
than it is today.
Speaker 4 (08:39):
So at the end of every financial year, the government
will tally up how much inflation goes inflation goes up
and then add that to your texted Yeah, okay, So
it's kind of like across the board as well. I mean, milk, eggs, bread,
everything goes up. But the reason it goes up is
because things start to cost more. The world starts to
(09:01):
cost more, beck you start to earn more, like the
world does increase over time. And when we look at it,
the RBA, which is the Reserve Bank of Australia, they're
kind of in charge of making sure that's consistent for
us and the reason we want it to be consistent
is so we can consistently afford to grow as an economy.
Inflation on average increases about two or three percent each
(09:22):
and every single year, which is good.
Speaker 2 (09:24):
That's nice. It's actually a sign of a growing economy
like that means that we're healthy as a country, right,
So that's good to see. This year it's seven percent,
And it's because we've gone through so much turmoil in
the last couple of years. That's kind of like now
hitting us like a ton of bricks, and so we're
feeling the wrath of what has happened previously, and the
RBA historically has tried to like protect us from that.
(09:47):
So the way that they're trying to protect us from
that is by increasing the cash rate. So the cash
rate is how much they're lending the let's call it
the government's money, how much they're lending the government's money
out to the big banks. So by increasing the ca
hash rate, it costs the banks more to borrow the
money from the RBA to give people mortgages and.
Speaker 4 (10:05):
Business loans and personal loans and home loans. And when
home loans and business loans and personal loans increase in
the amount of interest, you're paying.
Speaker 2 (10:13):
That means you're less likely to take it out. Right,
So if I said, Beck, you can buy a house today,
it's going to be like one point five percent finance Like,
you're going to get an interest rate that's really low.
You go some money in, that's a good deal. I
can afford that. That's only one point five percent. But
now today it's much higher than that, and a lot
of interest rates are at five percent. You start to go, oh,
(10:36):
I don't know if I could afford those repayments. I
don't know if that's going to work for me. So
you as the consumer, the person that gets the mortgage
or gets the personal loan or gets the business loan,
you're less likely to take it out. And if you're
less likely to take it out, what that means is
the economy starts to slow down because there's less people
like you making big purchases and throwing money around, so
that the economy starts to go down a little bit.
(10:58):
And that's what they're trying to do, so that we
can curb that growth or the inflation over time. So
if you're doing less in the economy, like you're not
buying as much, things are a bit more expensive. You're
kind of like holding your purse a little bit closer
to your chest, going like, I don't know if I
want to, you know, pay for that this month. It
means that there's less business going on in the community
and less business going on in the country, which means
(11:19):
ultimately the economy isn't doing as well, and that's what
they're trying to create.
Speaker 4 (11:23):
Does that make sense, Yeah, that does make sense.
Speaker 2 (11:26):
So like things are just kind of like slowing down,
and they're doing it on purpose because they want people
like you to be boring less money.
Speaker 4 (11:31):
Yeah, okay, so I guess for me, and I've said
this before, I do have a help debt. I've ever
finished a course, so I've just that's literally the worst.
Speaker 2 (11:43):
Like i mean, not the worst that you've done it.
I'm sure you've got a lot out of it, but
the amount of people in our community I've spoken to you,
like I have a help debt, I don't use it. Yeah,
Like I went to union and I did this and
now don't even work in the area. Or my friend
did this course. I thought I'd do that course and
then it was a terrible course and I didn't enjoy it,
or now I have thirty thousand dollars.
Speaker 4 (12:01):
Absolutely. I feel like I've started like five or six
subjects and never finished any of them. So I just
have all this money and no qualifications. But that's okay
because we're still here to tell the story.
Speaker 2 (12:11):
We're happy about it. We're making content because that was
worth it. It was worth it. It was worth it.
Speaker 4 (12:15):
And you know, I learned that if you learn something,
it's not a waste, no matter how you did it
all week whatever.
Speaker 2 (12:21):
You know what I'm trying to say. I think it
was my mum. I'm not sure who it was. I
want to give her credit for it, though she always
says it was either a blessing or a lesson. I
love that, and I feel like that's good because it
always reframes something as if it was kind of terrible.
Let's just call it a.
Speaker 4 (12:37):
Lesson, exactly, exactly, just call it a lesson.
Speaker 2 (12:39):
It makes me feel so much better about it. Perfect.
Speaker 4 (12:43):
So I mentioned this is the start of the episode.
I kind of am not stressing about the I suppose
like the indexation on hextet or helped it.
Speaker 2 (12:52):
I want to stop you there because I want to
hear why, like, why do you not feel that pressure?
When obviously a lot of people in the media jumping
up and down exacting, oh my gosh, what's going on? Why?
Speaker 4 (13:02):
So this is the thing. I don't know what that
looks like. So for me, helped, it remains the same.
And I'm so ignorant because I have no idea. But
for me, I think that, you know, I'm just.
Speaker 2 (13:15):
Going about my business.
Speaker 4 (13:16):
I'm paying like two bucks a week in hextet when
my employee takes out of my pay slip, and then
this is going to happen. My hex debt is going
to go up and my pay slip will be exactly
the same. So I don't know where the fear is.
But I could be completely wrong. I could it could
be changing my take home income.
Speaker 2 (13:38):
I don't know, all right, Beck, So we just took
a really quick minute away from the podcast so I
could get out a few calculators for you and organize
what this looks like. And now I'm scared. No, don't
be scared, but I do think it's really important to
understand where you stand and how that works for you.
So my favorite website, and I have, you know, put
(13:58):
it in the show notes before. It's paycalculator dot com.
Dot au. And the reason I like this is because
it's up to date with what's going on on the
ATO website. But in all honesty, it's better than the
ATO website. It's a privately owned website. I mean, this
guy whoever owns paycalculator dot com dot u is a wizard,
because everybody in the industry or in my industry uses
(14:21):
this website as kind of like a really good base
level calculator to just like go, oh, I'll whip it out,
see what's going on. You know, pop in your income,
see what that looks like. Anyway, everybody uses it, but
it's covered in ads, and you just know he's breaking
it in because every single time someone in our industry
goes there or you go there, he's making money. So
I just feel like that was a genius thing from him.
(14:42):
That is genius exactly. So if you go to this website,
you can basically put in your salary and then click options,
So you could click your salary includes superannuation or it doesn't,
or you could click student loan, which is what we're
talking about here. Yes, so many people, just like you,
they don't know what they're paying. All they see is
these headlines and get really stressed out about like, oh
(15:03):
my gosh, I'm going to be paying seven percent indexation,
Like I already can't afford a house. I already, you know,
struggle to buy a good coffee every friggin day, Like
what's going on. So, when it comes to calculating your repayments,
it's actually based on income thresholds, and those are different
from your marginal tax bracket. So your marginal tax bracket
is kind of the most normal one, which sits in
(15:25):
that thirty two point five cents per dollar, which most
people are in in our community, because it sits between
forty five than one twenty, Like, that's a really wide bracket.
People often think that that bracket then applies to your HEX,
but it doesn't. It's different from that. So if you
earn under forty eight thousand, three hundred and sixty one dollars,
you don't pay any of your HEX back. After that point,
(15:45):
it starts to increase, and the first amount that you
pay back is one percent, then two percent, then two
point five percent, and that is the repayment of your income.
It's a percentage of your income, not a percentage of
the debt that you owe. Right, So if you earn
forty eight thousand to fifty five thousand, eight hundred and
thirty six dollars, you pay back one percent. If you're
between fifty five and I'm just going to round these down,
(16:07):
but fifty five and fifty nine it's two percent, fifty
nine and sixty two it's two point five, sixty two
to sixty six it's three, and so on and so forth.
Let's pretend for a hot second that you earn an
income between seventy four hundred and ninety three dollars and
seventy four thousand, seven hundred and twenty two dollars. That
means that your repayment rate is four percent. So if
we calculated that out, and I've just popped in a
(16:30):
random number, and I can do this for you offline,
so it's your specific income back. But I've pretended that
you're on seventy three thousand dollars, right, which I feel
like is a pretty normal income for our community. That
means that every single week from your paycheck, you would
have a student loan amount of fifty six dollars coming out.
That's fifty six dollars that you're paying towards your help
(16:50):
or hex debt. That's not going into your back pocket.
The second that your hex or help debt doesn't exist,
that fifty six dollars goes back into your personal account.
You start being paid it right right, So that to
me is a fair whack of money, because like fifty
six bucks that you know, it's half my grocery bill, Like,
that's a lot of money. I think it's a lot. Fortunately,
(17:11):
that's one hundred and twelve dollars. Every single month, that's
two hundred and forty three dollars, and then every single year,
beck that adds up to twenty nine hundred and twenty dollars. Like,
that's a lot of money. I see, nine hundred and
twenty bucks. I could go on a holiday to Bali.
I reckon, in this economy, the flight's probably going to
cost two nine hundred dollars, But we don't want to
stretch that out right, I reckon, we jet Star. We
(17:33):
could get there. But moving on from that, I think
it's important to understand what that means because if you
actually increased your salary back and you were between a
different tax bracket, like let's say you earn eighty four
thousand dollars, that student loaner payment goes up. So now
on a salary of eighty four thousand dollars, you're actually
paying back five point five percent, which to me is
(17:54):
a fair whack. So five point five percent each and
every single week's eighty nine dollars. Every single fort nine,
it's one hundred and seventy eight dollars. Every month that's
three hundred and eighty six dollars, and every year that's
forty six hundred and twenty dollars. So this isn't something
that we should be blinking at. Like from little things,
big things grow. And I know you said, oh, it's
just like thirty bucks a week or whatever, and that
could be true for your circumstance, but thirty bucks a
(18:17):
week back ends up being fifteen hundred and sixty dollars. Okay,
I see, And we know that a lot of people
are still struggling to get you know, one thousand dollars
in their emergency fund. Yes, So it ultimately, to me,
is a lot of money that we should be caring about,
and I think that it's something that we do need
to discuss. And whether you're paying back more or less
isn't really about the conversation right now, The conversation I'm
(18:39):
having is I really want you to understand what your
paycelip means. I really want you to be in the
position where you just know what those repayments are. And
I mean it's not a decision you're making like you
have to pay that back. It's coming out before you
even get your money back. But what we want to
understand is is that something that's hindering your ability to
create wealth in the future and right now for your
(18:59):
personal situation. I don't think it is. I think it's fine.
You're bopping along, you're having a good time. Like I
know the financial position you're in, you shared it on
the podcast before, like you're not about to buy house
in the next six months. So it's not something that
we need to be worried about because it's not impacting
your borrowing capacity. So personally, I don't think you do care.
So do we worry about the seven percent? I mean,
(19:19):
yes we do. And the reason we do is because
we want to understand what that means for you. Pragmatically
and pragmatically, all we need to understand is what does
that mean for you? Beck? Right, So seven percent of
thirty thousand dollars is actually twenty one hundred bucks, So
that seven percent is going to mean that you go
up to thirty two thousand, one hundred dollars instead of
the thirty thousand dollars and beck we just said before
(19:41):
that if you're on an income of seventy four seventy
three thousand dollars, your student loan repayments every year about
twenty nine hundred and twenty dollars. So you just paid
twenty nine hundred and twenty dollars off. And what that's
going to feel like to you is that you only
paid eight hundred and twenty dollars off that year, even
though every single week fifty six bucks was coming out
(20:01):
of your account. It just increased. So no, there's no
interest on that, Like you're not paying an interest amount
on the repayments that you have, but that amount that
you owed increased by seven percent because of indexation, right,
I see?
Speaker 4 (20:14):
Okay, So I guess like I have two questions, but
they're kind of linked. So my thought is that if
the amount you pay on your HEX is dependent solely
on your income and not how much you have in HEX, yes,
I feel like that's a good thing. But also on
the other sides that I'm thinking, if this is a
(20:37):
common thing that your hex staate kind of goes up
on a yearly basis depending on how the economy is
going and things like that, it almost feels like, is
there any point in trying to like pay it off
faster or anything, because it's it just feels like you're
running on a treadmill.
Speaker 2 (20:54):
Like it's really frustrated. Gets the end of the.
Speaker 4 (20:56):
Year, you've paid x amount off and then the government's like,
here's some more, and then you just end up a
little bit better off, maybe even worse than you were
the year before.
Speaker 2 (21:07):
You know, Yeah, and it makes me really really frustrated
because that's an amount that you feel a bit sick about.
But it's not the government trying to screw us over,
let's be honest, Like, it's just not the government going, oh,
do you know what, we want to increase back stuff
by seven percent. I mean, they could choose not to.
So the Greens were actually proposing a law that would
freeze indexation for seventy four billion dollars in help loans,
(21:27):
which has been rejected by the Senate Committee, which I
think is a little bit rude. That's why I think
it's so much of a hot topic in the media.
A pitch it out because obviously would it help the
economy to freeze help debts, Probably because people are already stressed,
We're already not getting pay rises. It's why as she's
on the money, we're going to be going into even
more career content because I'm getting so frustrated with people
(21:49):
just not being paid what they're worth, people not being
able to afford the groceries that they were last year,
people not knowing their worth because they don't have the
confidence to ask, Like I just think that the government
could be doing more for us. But I guess let's
have a quick look back at what indexation has looked
like historically, because indexation is calculated each and every single year,
and basically it's not always the same. So in twenty eighteen,
(22:14):
indexation on our help debt was one point nine percent.
In twenty nineteen, it was one point eight. In twenty twenty,
it was one point eight. In twenty twenty one, it
was zero point six percent. In twenty twenty two it
was three point nine. So it increased, and the reason
it increased is because inflation in general was increasing, And
what they do is they take the average inflation rate
(22:36):
for the past two years and then apply that. So
they've done that again this year, and that's why we
are predicting it's going to be seven percent. That number
hasn't come from nowhere. That's come from us going Okay, well,
if the inflation rate last year and the inflation rate
this year is this, This is what that seven percent
looks like and where it's coming from. So that doesn't
mean that seven percent is going to happen again. It
might go back down. And in a perfect world, if
(22:58):
the RBA is doing exactly what they should be doing
by you know, helping to slow down economic growth and
helping to bring down the rate of inflation, next year
it won't be so much. So it won't be the
same thing each and every year, but there's always going
to be a level of indexation that is applied to
help or hex steps, because that's what we signed up for. Sure.
Speaker 4 (23:18):
Okay, if only I had read the te's and c's
before starting a million courses, Yeah.
Speaker 2 (23:24):
I just feel like even if you'd read the t's
and c's, you would have been like, whatever, I don't care.
Speaker 4 (23:27):
That's true. Actually, I could have been like, I don't
know what any of this means anyway, sign up.
Speaker 2 (23:30):
No, No, I'm glad we're best friends now, because I
could just be like your financial fairy god brother and
I could text me and be like, V, is this
a good idea and be like, no, it's not. I'll
like you grateful, I'll probably do it anyway. Let's be honest.
I mean, maybe that's very true.
Speaker 4 (23:45):
It's I'm an old dog and it's going to be
hard to learn new tricks, but we're going to get there.
I think this is a really good time to go
to a quick break and we'll see you guys on
the other side. All right, V, we are back and
ready to talk about help Hex helped it.
Speaker 2 (24:03):
Let's talk about he be Lily girl. You know what.
Sam probably isn't going to cut that out. He's what
he doesn't you know what? Neither do I. Let's move on.
Let's make a song.
Speaker 4 (24:12):
No, let's not this, Okay, sure, let's not. I'm going
to stick to podcasting. Yeah, that's fair. It's a fair
that's a fair career choice.
Speaker 2 (24:19):
That Facebook podcasts. You do have a face of podcast.
Thank you.
Speaker 4 (24:23):
Let's talk about help debt fe I think we were
just about to talk about the interest and I don't
know what these terms mean, but yeah, let's dive into it.
Let Steve dive inte.
Speaker 1 (24:32):
Why not?
Speaker 2 (24:33):
Yeah, So we want to talk about interest again because
I think it's important to touch on it. I mentioned
before that help slash Hex's debt doesn't actually attract an
interest rate, it just has an indexation rate. So it's
basically to take into account the different costs of living
and the way I see it, and I'm not defending
the government on this because I just don't think they
should do it. If I'm being really honest, I just
(24:54):
think that they should wipe it and be kind. But whatever,
they're doing it so that their dollar that they len
to you for your education isn't worthless when they get
it back. Oh those dirty dogs, I know, right, But
like it makes sense if I explain it like that,
Like if I said, hey, Beck, I'll pay for your
your degree. It's thirty thousand dollars, I'd like thirty thousand
dollars back. But as we explained before, a macis cone
(25:17):
in ninety seven is not worth what a macas cone
is today, But the same value is there. They're basically
saying we just want the value of our dollar back
so that we can you know, put that money into
something else and not have it be worthless. And you
kind of go, oh, that makes sense, Like that's a
pretty pretty sexy explain if I borrowed money from a
friend and they're like, oh, yeah, okay, can you just like,
(25:37):
if you want to borrow the money from me, can
you just make sure like there's no additional fees or
charges or anything that get charged to me, because individually,
I shouldn't be missing out if I'm lending the money
to you. And I mean, we're not friends with the government,
But that's okay.
Speaker 4 (25:48):
Actually it's a really good point, and I hadn't thought
about that. I suppose like what would happen to the government.
Will we just like crumble as a society if they
were to just like freeze it and we kind of
paid back the hex stet and it was worth less
than when they lent it to us.
Speaker 2 (26:05):
There's a lot of debate about this, but I mean
that's probably why the Greens got so up in arms
and they were like, it's not going to impact it,
Like I feel like from my perspective, and I mean
I've shared this perspective on the podcast before. We're so
lucky to live in Australia, right, Like, we have a
beautiful economy, we have beautiful infrastructure, we have a really
great healthcare system, we have roads that we can drive
(26:26):
on that are safe, there are rules in place and
there are people to protect us. Right. How good is that?
But there are a lot of things that a lot
of people don't agree with. I mean, we could start
a conversation about the doll we could start a conversation
about how government money is being channeled into the wrong
education places, where could be starting a conversation about how
there are a million schemes that need funding and don't
(26:47):
have it. But essentially, I just think that the government
is maintaining this so that they still have money to
go around because they just don't want their dollar to
be worth less tomorrow than it is today to them.
And they essentially, from my perspective, they're seeing helping you
out as a privilege. They're seeing it as like, Okay,
well I helped beck out, she didn't have to cough
(27:08):
up thirty grand to go to university. I'm gonna just
ask for that money back, and that's a fair way
of doing things. Obviously, the same is not true in
other countries, like in America, like they have to get
very expensive student loans that are worth a whole heap
of money and have a whole heap of interest associated
with them. And then on the flip sides, there are
countries that have a completely free education system. In fact,
(27:30):
Australia used to have a free education system where university
was free, and this wish that happened again. So essentially,
what I think that they're trying to do is get
back the money because they just don't have enough of
it to go round at the moment. And I think
that from their perspective they're doing the right things, but
from a community perspective, I think they could be doing more.
Speaker 4 (27:50):
Amen'sis mic drop.
Speaker 2 (27:51):
I don't know if that's a mic drop. I just
you know what I mean. I feel like we've all
got our own opinions on how things work, and I
just think that that's where it gets political. And this
isn't a political podcast, right. I just think it's a
podcast about doing the right thing and being good people.
And you know, I just think that students and people
who have hex stets are having a bit of a
hard time. What would we do about there? It's not
(28:12):
really yeah, a political conversation for me, it's not going,
oh my god, the Greens a label or liberal like.
The Greens had this idea to freeze indexation for seventy
four billion dollars, and I nodded and smiled and said,
you know what, that's a pretty good idea. I think
people would like that.
Speaker 4 (28:26):
Yeah, absolutely, and I'm sure there will be absolutely no
consequences whatsoever. So at the end of the day, I've
gotten all this information, what does this actually look like
for help loans?
Speaker 2 (28:37):
Obviously I am stouts girl. I've done some maths because
I love to do maths. I also love to stop
the podcast halfway through so I can do some sly
maths and come back. You guys don't have to wait
because we edit all of the waiting time out.
Speaker 4 (28:51):
But Beck does, so I will say patiently.
Speaker 2 (28:53):
You do you smile or nod, But from the first
of June, most Australians with an outstanding student loan debt
will actually see their balance shoot up by hundreds or
even a thousands of dollars. Beck, if the indexation rate
does go up by seven point one percent, So I
calculated that really quickly for you. But I've got a
few examples. So if you've got ten grands left on
your loan, it's going to increase by seven hundred and
(29:15):
ten dollars. For every ten thousand dollars in debt you have,
it will consistently increase by seven hundred and ten thousand dollars.
So if you have a twenty five thousand dollar loan balance,
it would increase by seventeen hundred and seventy five dollars.
Beck And if you had a fifty thousand dollar loan,
it would increase by three thousand, five hundred and fifty dollars.
And Beck, do you want to know how much my
(29:36):
hex STEP's going to be increasing by? Because you know,
we've been a little pervy, we're being a little personal
go on. So I still have eighty thousand dollars worth
of hex step, So I'm going to be slammed with
five thousand, six hundred and eighty dollars worth of indexation. No,
that's a trip for two to Bali.
Speaker 4 (29:52):
At least, yeah, at least please.
Speaker 2 (29:55):
But again, I feel very grateful to have that system
in place, And I mean there's actually no way that
I could have personally afforded to go to university and
get the degrees that I have without the help and
HEXT system. So am I mad that that's the case?
Speaker 3 (30:08):
No?
Speaker 2 (30:08):
Not really. I feel like it's you know, part and
parcel of the system that we are using. I mean,
could I be mad about it? Yeah, it's a lot
of money, but again I think that I'm just trying
to see it from a more positive light of like,
that's the cost of you know, me being able to
get to where I want to be in life, because
Lord knows, I wouldn't have gotten anywhere without those degrees. Amen, Well,
(30:30):
could you be sad about it? I could be sad
about it, Like I could just be a little sad that,
you know, I'm in a bit more debt. But honestly,
I see my HEX debt as something that has helped
me in the past few years. It has got me
to where I need to go. There was a period
of time where it made me feel physically sick when
I logged into my portal because it was more don't
(30:51):
log in. Yeah it was more than one hundred grand,
and I'd be like, whoah, who let that happen? Whose
idea was that, And it's kind of like you. Right
when I started my degree, I just didn't think about
how much debt I was racking up, Like I was
not interested in finance. We've talked about this publicly before
that by the time I was twenty two, I was
in like I think it was forty four thousand dollars
worth of personal debt. Like I was really good at that,
(31:13):
and that didn't worry me at the time until I
started learning more and more about finance and I kind
of was like, oh, I might need to pull my
socks up. This is a lot of money. And like
I got out of that. It took a lot of
work and a lot of time. But it's one of
those things where now things like this mean a bit
more to me because I'm grateful for them. But when
I took them on, I had no concept of what
that would look like for me in the future. And
(31:34):
I think a lot of people are in that circumstance.
Speaker 4 (31:36):
Yeah, absolutely, it is good to know that it hasn't
been this high historically and hopefully won't be the case
in future years.
Speaker 2 (31:44):
It's actually not sustainable if it was in future years, right,
because if it was in future years, you're gonna be
is a bit screwed, babe. Like, there's a lot more
going on than help in hex debt repayments. I promise
if indexation kept up at that rate, there's going to
need to be some serious and the government would get
involved to promise it's okay, and they would drown in
our tears. They would, they would.
Speaker 4 (32:06):
So should people start trying to pay down their helped
it before the first.
Speaker 2 (32:10):
Of June, Beck, you should know better than asking a
personal advice question on this podcast. This podcast is general
advice only, and you shouldn't actually take my advice on
anything because that would be financially irresponsible. I have a
license to uphold Beck. That's fair. Now pretend, but pretend here, Okay,
So there are a few things that I want you
to think about. So first things first, we know that
(32:31):
every single persons situation is different, and if you're stressing
over it but you can't afford it, please stop stressing.
It is what it is. Let's not stress about the
things we can't change, Like, what's the point. Absolutely, if
it's something that is stressing you, then maybe we can
look at it in a bit more depth. But I
think making sure that you're comfortable with that and you
know what it means and how it works is basically
(32:52):
what everyone can do. Whether we contribute more or not
is a different conversation. But given what we've discussed for
the first time in a long, long, long time, it
actually might be worth for some people to be making
extra contributions to their HEX debt. It's something that personally,
I will not be doing, and the reason I'm not
doing it is because I don't need to do that
(33:12):
to achieve the goals that I currently have. So if
my goal was to buy a house, and I knew
that by paying down some of my HEX debt would
mean that my ability to lend more money would increase them,
maybe it would be worth it for me. Maybe I
could do that. But if you're in that circumstance shameless
plug for Zella Money, please go. We'll put the link
in the show notes to talk to one of our brokers.
(33:33):
If you are in the position to be purchasing a house,
or you think you're in the position to purchase house
and you're thinking about your HEX debt repayments, go and
talk to a mortgage broker so that they can look
at your whole circumstance, and they can sit you down
and be like, yep, back in your situation, it would
do this for you, and you go, great, I will
do that. Can I tell you that on a podcast?
Unfortunately not. But what I can tell you is that
(33:55):
it might change it for some people, it might not
because it's going to depend how much text debt do
you have, how much can you afford to repay? What
is your current deposit for the home that you're looking
to buy? Do you have a Garran tool loan? What
do all these things actually mean for you? There's no
one size fits or response to that, and I am
very sorry. I wish there was. Did it make content
creations so much easier?
Speaker 1 (34:16):
Oh?
Speaker 2 (34:17):
Fuck you? Just make the podcast be like, all right, guys,
so indexations coming out first of June. This is what
we're going to do.
Speaker 4 (34:22):
These are the rules, These are the answers.
Speaker 2 (34:25):
Beck, You're going to do X and if you're not
in exposition do why do? How much easier content creation
would be? The community would love it? But do you
know what, You've got to do some of the work yourself.
Speaker 4 (34:35):
Unfortunately, unfortunately, but.
Speaker 2 (34:37):
The girls that Zella Money can basically do that for
you and kind of calculate it based on your personal circumstances. Also,
they'll do it for free, so that's kind of a
money we Oh my god. As I said, and I've
said a million times before, I would always prioritize paying
off personal debt first, so things like personal loans and
credit cards and any other personal debt. I would also
(34:59):
look at bumping up your emergency fund, because your emergency
fund is going to be that fund that means that
you can get out of a pickle real quick. Someone
the other day called it a squirrel fund, and I
thought that was real cute, because like squirrels, they're like
hide away all their nuts for the winter, and then
they live off their nuts in the winter when things
aren't as good. That's what how emergence. That's very cute. Anyway,
(35:21):
we want a squirrel fund. We want to make sure
that we're not in any personal debt, and at that
point we can consider whether making additional contributions to our
hex or help debt is a good idea. Perfect Again,
it's going to depend on whether you're going for a
home loan or not as to whether that is worth
it or you know, what could just be stressing the
but Jesus out of you, Beck. You could be so
stressed over your heck's debt, and no matter how many
(35:43):
times you listen to me or how many times you
listen to other podcasts, it's just something that keeps you
up at night. Maybe making additional contributions to something that
fits within your goals makes you feel good. You do you, sis,
you do you, You do you. But what I want
you to be able to do is tell me what
your payments are, what they look like, how it impacts
you as an individual, what it actually looks like if
(36:03):
you paid off more debt. Because a lot of people
might go, I really need to get rid of my
hex step before I get a home. That's actually not true.
I bought a house with a one hundred thousand dollars worth
of hex step. We work with people every single day
that have very large hex stets and still get homes.
That's company. So it's really important to understand that doesn't
need to be completely diminished before you do that. That's
(36:26):
why I want you to talk to a broker, because
the amount of people that I have spoken to that
are like, oh my god, vee, like I've paid off
eighty thousand dollars worth of my hex stet. I go
far out, that's so sick, like, that's so good, And
then they say, so I'm going to now start saving
for a house, and I kind of go, oh good,
smile a nod like, because there's nothing I can do
about that circumstance. But in reality, if they had the
(36:48):
capacity to pay off an eighty thousand dollars home loan,
they had the capacity to save eighty thousand dollars, and
they could have probably already been in a house and
just started paying off their hextet a bit more now
that they have the property. And obviously, when it comes
to investing, the sooner you're in the market, the more
time you have for compound interest to play into it.
And sometimes that's the best outcome. Am I saying that
(37:09):
that's right for every single person? No, But that's why
you need to be educated, because if you're stressing about
your hextet, I can almost guarantee that the reason you're
stressing about it is because you don't know enough about it.
You don't know the semantics of that hexel help debt,
but you also don't know how it impacts you financially,
and that makes people stressed. So talk to someone, listen
(37:30):
to some more podcasts, go and talk to a mortgage
broker about how that actually impacts you, because Beck, you know,
we calculated what your hex step looks like and how
much you're paying back. You're like, yeah, okay. I feel
like you said yep, okay, because that was about what
you expected anyway, Yes, you were fine with that, and
you're also not looking into any other big goals. But
(37:51):
would you be stressed about it if you were on
the home buying process and you're like, oh, I don't
know what that looks like.
Speaker 4 (37:56):
If I didn't know, and I guess I don't really
know that much kind of do now about it. I
do the whole podcast, but I wouldn't know the process
of like buying a house very well. But the idea
that you have a debt might make you stress. I
think about achieving something else. I think that would probably
stress me out a little bit. More money MO problems.
Speaker 2 (38:15):
Exactly exactly, but essentially, I guess the crux of this
is I just want you guys to be educated. I
hope that this has given you the level of education
that you deserve, but also there are going to be
a whole heap of resources on our Instagram soon. I'm
probably going to make a whole heap of tiktoks because
I keep being told off by the cheese. The TikTok well,
I don't. I don't love making them, but my team
(38:35):
keep bullying me into making more, so I will do that.
But I just I want you to be in the
best possible position to make the best decision for you,
and that is honestly all I can do.
Speaker 4 (38:45):
I love that visa anything else before we shut this down?
Speaker 2 (38:49):
Yeah, okay, so first things first. Obviously, education is the key.
I could go on about it forever. If you don't
know what's going on with your HEX or help debt,
you can check it through your mygove login. That's just
like the Tax Officers online platform. You guys should know
what my guve is. If you don't, please google it
and make sure that you log into that and have
a look, because that's not just got your HEX, it's
(39:09):
got your tax information, it's got your Medicare information. It's
kind of like your personal hub. The simplest way to
make your repayment on Hex is actually just through bepay
it's so easy. I'm not saying go do it right now,
but what I am saying is, like, I think a
lot of people assume it's this really complex process. It's not.
It's just a be pay for repayment, like you just
transfer it like you would be transferring your mate when
(39:31):
they bought the pizza. Easy, really easy. So if you
are considering making a repayment and you're like, oh, I'm
really stressed about this, or I only have a little
to go rah rah, make sure you're making that repayment
well before the end of May to make sure it's
processed in time to avoid any additional indexation that might
be applied to that. So just be in really early
because when it happens, it's going to happen on the
(39:51):
first of June, so you want to make sure that
you are getting that payment in asap. If that is
your plan.
Speaker 4 (39:57):
I love that.
Speaker 2 (39:58):
I'm done. Are you done? I could keep going on
and on, but I think we need to be done,
and I could keep listening. No, you couldn't. You're sick.
You are so sick of me.
Speaker 4 (40:07):
I think it's lots of absorbed. Let's go and have
a little tea.
Speaker 2 (40:10):
You have a little walk. We deserve Yeah, I think
we deserve a treat.
Speaker 4 (40:13):
I think we just have a treat.
Speaker 2 (40:14):
Everybody deserves a treat. Have a good day. We will
see you guys on Friday.
Speaker 4 (40:18):
See you soon bybe.
Speaker 2 (40:25):
The advice shared.
Speaker 3 (40:26):
On She's on the Money is general in nature and
does not consider your individual circumstances. She's on the Money
exists purely for educational purposes and should not be relied
upon to make an investment or financial decision. If you
do choose to buy a financial product, read the PDS
TMD and obtain appropriate financial.
Speaker 2 (40:44):
Advice tailored towards your needs.
Speaker 3 (40:46):
Victoria Divine and She's on the Money are authorized representatives
of money sirper Pty Ltd ABN three two one IS
six four nine two seven seven zero eight AFSL four
five one two eight nine
Hello, my name's Santasha Nabananga Bamblet. I'm a proud yr
the Order Kerni Whoalbury and a waddery woman. And before
we get started on She's on the Money podcast, I
would like to acknowledge the traditional custodians of the land
of which this podcast is recorded on a wondery country,
acknowledging the elders, the ancestors and the next generation coming
(00:22):
through as this podcast is about connecting, empowering, knowledge sharing
and the storytelling of you to make a difference for
today and lasting impact for tomorrow.
Speaker 2 (00:33):
Let's get into it.
Speaker 3 (00:34):
She's on the Money, She's on the Money.
Speaker 4 (00:57):
Hello, and welcome to She's on the Money, the podcast
for millennials who want financial freedom, hex or help. Debt
has long been described as the best debt you can have. Debatable,
it's very debatable, debatable, but still described it as that
who described Is it still the case just producer.
Speaker 2 (01:17):
Or was it the internet?
Speaker 4 (01:19):
Look, I think that it's both of those things probably,
But listen, as you said before we started recording this
v let's baby, I think we should really got helped
it Now though it helped it or hextet, what's the.
Speaker 2 (01:33):
They're they're same. They're the same, so I will probably
accidentally call it hex interchangeably. So HEX is for those
of us who are elder millennials, and we had Hex's debt,
but it has since been updated to be called just
across the board help debt helped. It sounds more cute,
does it. I think it's kind of crue anyway. I don't.
I don't care what it's called. I'm just mad that
(01:54):
I can't make X jokes.
Speaker 4 (01:56):
Isn't as as a sexy though, that's not that's for sure.
But we are talking about this because we have been
getting so many messages, six.
Speaker 2 (02:04):
Million of them, six fi million to be exact. I
would never overestimate either.
Speaker 4 (02:09):
Oh no, certainly not. We don't do that here at
Che's on.
Speaker 2 (02:12):
Them, absolutely not.
Speaker 4 (02:13):
So how scared should we be of headlines like he's indexation,
everything's rising?
Speaker 2 (02:20):
Well, I don't know. Well, it makes sense that we've
been getting so many messages, right because we are hearing
all through the news that on the first of June
HEX is going to be indexed by seven point one percent.
And I guess today is the day that we are
going to be talking about that, because it is wild
and when I just need to make sure that everyone
is aware that I do mean the first of June,
not the thirtieth of June, because a few people have
(02:42):
messaged me because I was on Instagram Stories just like
talking about it the other day and they're like, oh,
don't you mean the thirtieth of June when you know
end of financial year happens. No, this happens on the
first of June, ahead of the end of financial year,
so that in a month, basically, in the next thirty days,
they can calculate what your repayments were be with the
new level of indexation and can hit the ground running
(03:03):
from the first of July basically. So I'm not wrong.
I just feel the need to, like, you know, back
myself a little bit and be like, this is why
I'm correct. But also people were right to slide into
my dams because I'm consistently wrong. So if you would
like to correct me, you are more than welcome to
so don't. Yeah, I feel like a diep when I
correct myself, right, Sure, I just feel a little bit
rude when I'm like, I was right. I know it is.
Speaker 4 (03:26):
It is a bit awkward when you have to be
like Oh, actually, I did.
Speaker 2 (03:29):
I think this is the correct Yeah. Like, actually, I
don't know if you know this, but like I'm really
into finance, like really really into finance. And while I
might get dates wrong consistently, if it was the thirtieth
of June, I would know because that's my birthday. Oh
thirty is the June's your birthday? That end of July? Yes, sexy,
I'm an end of financial year baby. Is there a
(03:49):
better date for thirday in the year than the thirtieth
of June. I hope you get a big chunk of
return for your birthday? No, I always end up owing money.
It is actually a joke, is okay? Thank you for
tho as well wishes though. Let's talk about debt.
Speaker 4 (04:04):
So you've probably heard on the news the term student
debt avalanche.
Speaker 2 (04:10):
It's dramatic, isn't it. It seems dramatic.
Speaker 4 (04:12):
And I'm also like, I'm not yet scared, but like
should I be scared?
Speaker 2 (04:16):
Whyren't you scared? I just stowed a headline that they're
trying to make you scared, and you're still like, nah,
take it, take it.
Speaker 4 (04:23):
I can take it, because like to me, I feel
like avalanche.
Speaker 2 (04:25):
That's nothing. It's thirty bucks a month.
Speaker 4 (04:28):
I'm like, I don't really mind, to be honest, but like,
should I be more worried about we should?
Speaker 2 (04:33):
I mean, at the end of the day, when they're
talking about the student debt avalanche, it is proposed that
on the first of June, the student debt here in
Australia on the first of June is going to increase
by five billion dollars this year because of that seven
point one level of indexation. So that's a lot of money.
And I mean for you, you might go whatever, it's
thirty bucks, but to a lot of people, thirty bucks
(04:53):
is a lot of money. And when you're paying back
your HEX debt, especially if you're on a lower income
and you're not maybe you know, in one of those
high marginal tax brackets, but you're in the bracket where
you're starting to pay back your debt, it just feels
like it stacks on a little bit, like it genuinely
feels like you're getting nowhere. And I mean you are,
I promise, but it just feels like you're going backwards.
And I think that there's just this I don't know,
(05:14):
it's just a unspoken concept of hex versus help that
it's there to help you, and it feels like you're
kind of being kicked while you're down. Like you already
have hex debt, You already see it on your pay
slip coming out. You already know that that's money that's
not going into your back pocket. We know how we
feel about debt in general. Yes, we've spoken about the
(05:35):
difference between good, bad, and okay debt here on the podcast.
But I just feel like we're all just a little
bit salty with indexation because for so long we've just
talked about how hex slash help debt doesn't have an
interest rate associated with it, Right, So when you hear
that Beck, you smile and nod, go yeah great, but
it is indexed, So it kind of feels like we're
being kicked while we're down. Does that make sense? Kind of?
Speaker 4 (05:58):
But I guess, like what my estion is is what
is indexation and what are the basics of it?
Speaker 2 (06:05):
Stunning question. So indexation basically just means an adjustment to
a price or a wage or other value based on
the changes in other prices or a composite indicator of prices. Right,
So we spoke about it a couple of weeks ago
on the podcast where indexation is basically how much something
increases in value over time. And my favorite example of this,
(06:25):
which I didn't give you a saved it for this podcast,
the maccas cone. Oh Maca's ice cream cone? Right, yes, So, like,
do you remember back in the day. I don't know
if you ever had this luxury, but my mum would
give me a fifty cent coin silver, it was silver.
I don't know if anyone sin silver coins these days
(06:46):
because they can't buy you anything anymore. But I get
a fifty cent cone from macis.
Speaker 4 (06:51):
I actually remember when they were thirty cent.
Speaker 2 (06:53):
I feel like they went twenty cents. I feel like
twenty twenty. But last time I spoke about that publicly,
everyone was like, they are fifty cents. Was going to
call it fifty cents, right, So I do remember, probably
late primary school I was paying fifty cents for a
Maca's cone. After school we go to swimming lessons and
then we get a Maca's cone. Is like our treat,
little treaty treat for you know, going to swimming lessons,
(07:14):
as though it's not already a privilege to go to
swimming lessons, like Victoria Devine. Anyway, you're right. I feel
like it used to be twenty cents at some point,
but this is beyond the point. It is now what
like a dollar fifty? A dollar fifty, I think it's
like more than a dollar. Oh, blow me down. I
feel like in different locations around Australia, somewhere you're going
to say, oh, they're a dollar, somewhere else they're like
a dollar fifty. Right, Okay, so that has increased in
(07:36):
price over time. But are you getting the same product, beck,
I would say, identical product, identity. It's just nowadays it
costs more to produce. It's going to be more expensive.
So the dollar that you used to have back in
nineteen ninety eight, when I was seven years old and
going to swimming lessons and paying twenty cents for a cone,
I could have bought five of those ice cream cones
(07:57):
for a dollar. But today, if I gave you a dollar,
you could only buy one, and in some locations you
wouldn't even be able to buy one. You need another
fifty cents to get there. Right, So a dollar today
is not worth what a dollar tomorrow is worth. And
that's what that saying means. So indexation is that increase
in price. So it's the difference of going from twenty
cents to a dollar and you kind of don't get
(08:19):
any more value out of that product. You're still getting
the Maca's cone. There's actually no more value. It's not
any better today than it was back then because it's
probably the same recipe. So like nothing has changed about
it except the price. And that's what inflation is. It
just means that a dollar back then was actually quote
worth more because you could buy more with that dollar
than it is today.
Speaker 4 (08:39):
So at the end of every financial year, the government
will tally up how much inflation goes inflation goes up
and then add that to your texted Yeah, okay, So
it's kind of like across the board as well. I mean, milk, eggs, bread,
everything goes up. But the reason it goes up is
because things start to cost more. The world starts to
(09:01):
cost more, beck you start to earn more, like the
world does increase over time. And when we look at it,
the RBA, which is the Reserve Bank of Australia, they're
kind of in charge of making sure that's consistent for
us and the reason we want it to be consistent
is so we can consistently afford to grow as an economy.
Inflation on average increases about two or three percent each
(09:22):
and every single year, which is good.
Speaker 2 (09:24):
That's nice. It's actually a sign of a growing economy
like that means that we're healthy as a country, right,
So that's good to see. This year it's seven percent,
And it's because we've gone through so much turmoil in
the last couple of years. That's kind of like now
hitting us like a ton of bricks, and so we're
feeling the wrath of what has happened previously, and the
RBA historically has tried to like protect us from that.
(09:47):
So the way that they're trying to protect us from
that is by increasing the cash rate. So the cash
rate is how much they're lending the let's call it
the government's money, how much they're lending the government's money
out to the big banks. So by increasing the ca
hash rate, it costs the banks more to borrow the
money from the RBA to give people mortgages and.
Speaker 4 (10:05):
Business loans and personal loans and home loans. And when
home loans and business loans and personal loans increase in
the amount of interest, you're paying.
Speaker 2 (10:13):
That means you're less likely to take it out. Right,
So if I said, Beck, you can buy a house today,
it's going to be like one point five percent finance Like,
you're going to get an interest rate that's really low.
You go some money in, that's a good deal. I
can afford that. That's only one point five percent. But
now today it's much higher than that, and a lot
of interest rates are at five percent. You start to go, oh,
(10:36):
I don't know if I could afford those repayments. I
don't know if that's going to work for me. So
you as the consumer, the person that gets the mortgage
or gets the personal loan or gets the business loan,
you're less likely to take it out. And if you're
less likely to take it out, what that means is
the economy starts to slow down because there's less people
like you making big purchases and throwing money around, so
that the economy starts to go down a little bit.
(10:58):
And that's what they're trying to do, so that we
can curb that growth or the inflation over time. So
if you're doing less in the economy, like you're not
buying as much, things are a bit more expensive. You're
kind of like holding your purse a little bit closer
to your chest, going like, I don't know if I
want to, you know, pay for that this month. It
means that there's less business going on in the community
and less business going on in the country, which means
(11:19):
ultimately the economy isn't doing as well, and that's what
they're trying to create.
Speaker 4 (11:23):
Does that make sense, Yeah, that does make sense.
Speaker 2 (11:26):
So like things are just kind of like slowing down,
and they're doing it on purpose because they want people
like you to be boring less money.
Speaker 4 (11:31):
Yeah, okay, so I guess for me, and I've said
this before, I do have a help debt. I've ever
finished a course, so I've just that's literally the worst.
Speaker 2 (11:43):
Like i mean, not the worst that you've done it.
I'm sure you've got a lot out of it, but
the amount of people in our community I've spoken to you,
like I have a help debt, I don't use it. Yeah,
Like I went to union and I did this and
now don't even work in the area. Or my friend
did this course. I thought I'd do that course and
then it was a terrible course and I didn't enjoy it,
or now I have thirty thousand dollars.
Speaker 4 (12:01):
Absolutely. I feel like I've started like five or six
subjects and never finished any of them. So I just
have all this money and no qualifications. But that's okay
because we're still here to tell the story.
Speaker 2 (12:11):
We're happy about it. We're making content because that was
worth it. It was worth it. It was worth it.
Speaker 4 (12:15):
And you know, I learned that if you learn something,
it's not a waste, no matter how you did it
all week whatever.
Speaker 2 (12:21):
You know what I'm trying to say. I think it
was my mum. I'm not sure who it was. I
want to give her credit for it, though she always
says it was either a blessing or a lesson. I
love that, and I feel like that's good because it
always reframes something as if it was kind of terrible.
Let's just call it a.
Speaker 4 (12:37):
Lesson, exactly, exactly, just call it a lesson.
Speaker 2 (12:39):
It makes me feel so much better about it. Perfect.
Speaker 4 (12:43):
So I mentioned this is the start of the episode.
I kind of am not stressing about the I suppose
like the indexation on hextet or helped it.
Speaker 2 (12:52):
I want to stop you there because I want to
hear why, like, why do you not feel that pressure?
When obviously a lot of people in the media jumping
up and down exacting, oh my gosh, what's going on? Why?
Speaker 4 (13:02):
So this is the thing. I don't know what that
looks like. So for me, helped, it remains the same.
And I'm so ignorant because I have no idea. But
for me, I think that, you know, I'm just.
Speaker 2 (13:15):
Going about my business.
Speaker 4 (13:16):
I'm paying like two bucks a week in hextet when
my employee takes out of my pay slip, and then
this is going to happen. My hex debt is going
to go up and my pay slip will be exactly
the same. So I don't know where the fear is.
But I could be completely wrong. I could it could
be changing my take home income.
Speaker 2 (13:38):
I don't know, all right, Beck, So we just took
a really quick minute away from the podcast so I
could get out a few calculators for you and organize
what this looks like. And now I'm scared. No, don't
be scared, but I do think it's really important to
understand where you stand and how that works for you.
So my favorite website, and I have, you know, put
(13:58):
it in the show notes before. It's paycalculator dot com.
Dot au. And the reason I like this is because
it's up to date with what's going on on the
ATO website. But in all honesty, it's better than the
ATO website. It's a privately owned website. I mean, this
guy whoever owns paycalculator dot com dot u is a wizard,
because everybody in the industry or in my industry uses
(14:21):
this website as kind of like a really good base
level calculator to just like go, oh, I'll whip it out,
see what's going on. You know, pop in your income,
see what that looks like. Anyway, everybody uses it, but
it's covered in ads, and you just know he's breaking
it in because every single time someone in our industry
goes there or you go there, he's making money. So
I just feel like that was a genius thing from him.
(14:42):
That is genius exactly. So if you go to this website,
you can basically put in your salary and then click options,
So you could click your salary includes superannuation or it doesn't,
or you could click student loan, which is what we're
talking about here. Yes, so many people, just like you,
they don't know what they're paying. All they see is
these headlines and get really stressed out about like, oh
(15:03):
my gosh, I'm going to be paying seven percent indexation,
Like I already can't afford a house. I already, you know,
struggle to buy a good coffee every friggin day, Like
what's going on. So, when it comes to calculating your repayments,
it's actually based on income thresholds, and those are different
from your marginal tax bracket. So your marginal tax bracket
is kind of the most normal one, which sits in
(15:25):
that thirty two point five cents per dollar, which most
people are in in our community, because it sits between
forty five than one twenty, Like, that's a really wide bracket.
People often think that that bracket then applies to your HEX,
but it doesn't. It's different from that. So if you
earn under forty eight thousand, three hundred and sixty one dollars,
you don't pay any of your HEX back. After that point,
(15:45):
it starts to increase, and the first amount that you
pay back is one percent, then two percent, then two
point five percent, and that is the repayment of your income.
It's a percentage of your income, not a percentage of
the debt that you owe. Right, So if you earn
forty eight thousand to fifty five thousand, eight hundred and
thirty six dollars, you pay back one percent. If you're
between fifty five and I'm just going to round these down,
(16:07):
but fifty five and fifty nine it's two percent, fifty
nine and sixty two it's two point five, sixty two
to sixty six it's three, and so on and so forth.
Let's pretend for a hot second that you earn an
income between seventy four hundred and ninety three dollars and
seventy four thousand, seven hundred and twenty two dollars. That
means that your repayment rate is four percent. So if
we calculated that out, and I've just popped in a
(16:30):
random number, and I can do this for you offline,
so it's your specific income back. But I've pretended that
you're on seventy three thousand dollars, right, which I feel
like is a pretty normal income for our community. That
means that every single week from your paycheck, you would
have a student loan amount of fifty six dollars coming out.
That's fifty six dollars that you're paying towards your help
(16:50):
or hex debt. That's not going into your back pocket.
The second that your hex or help debt doesn't exist,
that fifty six dollars goes back into your personal account.
You start being paid it right right, So that to
me is a fair whack of money, because like fifty
six bucks that you know, it's half my grocery bill, Like,
that's a lot of money. I think it's a lot. Fortunately,
(17:11):
that's one hundred and twelve dollars. Every single month, that's
two hundred and forty three dollars, and then every single year,
beck that adds up to twenty nine hundred and twenty dollars. Like,
that's a lot of money. I see, nine hundred and
twenty bucks. I could go on a holiday to Bali.
I reckon, in this economy, the flight's probably going to
cost two nine hundred dollars, But we don't want to
stretch that out right, I reckon, we jet Star. We
(17:33):
could get there. But moving on from that, I think
it's important to understand what that means because if you
actually increased your salary back and you were between a
different tax bracket, like let's say you earn eighty four
thousand dollars, that student loaner payment goes up. So now
on a salary of eighty four thousand dollars, you're actually
paying back five point five percent, which to me is
(17:54):
a fair whack. So five point five percent each and
every single week's eighty nine dollars. Every single fort nine,
it's one hundred and seventy eight dollars. Every month that's
three hundred and eighty six dollars, and every year that's
forty six hundred and twenty dollars. So this isn't something
that we should be blinking at. Like from little things,
big things grow. And I know you said, oh, it's
just like thirty bucks a week or whatever, and that
could be true for your circumstance, but thirty bucks a
(18:17):
week back ends up being fifteen hundred and sixty dollars. Okay,
I see, And we know that a lot of people
are still struggling to get you know, one thousand dollars
in their emergency fund. Yes, So it ultimately, to me,
is a lot of money that we should be caring about,
and I think that it's something that we do need
to discuss. And whether you're paying back more or less
isn't really about the conversation right now, The conversation I'm
(18:39):
having is I really want you to understand what your
paycelip means. I really want you to be in the
position where you just know what those repayments are. And
I mean it's not a decision you're making like you
have to pay that back. It's coming out before you
even get your money back. But what we want to
understand is is that something that's hindering your ability to
create wealth in the future and right now for your
(18:59):
personal situation. I don't think it is. I think it's fine.
You're bopping along, you're having a good time. Like I
know the financial position you're in, you shared it on
the podcast before, like you're not about to buy house
in the next six months. So it's not something that
we need to be worried about because it's not impacting
your borrowing capacity. So personally, I don't think you do care.
So do we worry about the seven percent? I mean,
(19:19):
yes we do. And the reason we do is because
we want to understand what that means for you. Pragmatically
and pragmatically, all we need to understand is what does
that mean for you? Beck? Right, So seven percent of
thirty thousand dollars is actually twenty one hundred bucks, So
that seven percent is going to mean that you go
up to thirty two thousand, one hundred dollars instead of
the thirty thousand dollars and beck we just said before
(19:41):
that if you're on an income of seventy four seventy
three thousand dollars, your student loan repayments every year about
twenty nine hundred and twenty dollars. So you just paid
twenty nine hundred and twenty dollars off. And what that's
going to feel like to you is that you only
paid eight hundred and twenty dollars off that year, even
though every single week fifty six bucks was coming out
(20:01):
of your account. It just increased. So no, there's no
interest on that, Like you're not paying an interest amount
on the repayments that you have, but that amount that
you owed increased by seven percent because of indexation, right,
I see?
Speaker 4 (20:14):
Okay, So I guess like I have two questions, but
they're kind of linked. So my thought is that if
the amount you pay on your HEX is dependent solely
on your income and not how much you have in HEX, yes,
I feel like that's a good thing. But also on
the other sides that I'm thinking, if this is a
(20:37):
common thing that your hex staate kind of goes up
on a yearly basis depending on how the economy is
going and things like that, it almost feels like, is
there any point in trying to like pay it off
faster or anything, because it's it just feels like you're
running on a treadmill.
Speaker 2 (20:54):
Like it's really frustrated. Gets the end of the.
Speaker 4 (20:56):
Year, you've paid x amount off and then the government's like,
here's some more, and then you just end up a
little bit better off, maybe even worse than you were
the year before.
Speaker 2 (21:07):
You know, Yeah, and it makes me really really frustrated
because that's an amount that you feel a bit sick about.
But it's not the government trying to screw us over,
let's be honest, Like, it's just not the government going, oh,
do you know what, we want to increase back stuff
by seven percent. I mean, they could choose not to.
So the Greens were actually proposing a law that would
freeze indexation for seventy four billion dollars in help loans,
(21:27):
which has been rejected by the Senate Committee, which I
think is a little bit rude. That's why I think
it's so much of a hot topic in the media.
A pitch it out because obviously would it help the
economy to freeze help debts, Probably because people are already stressed,
We're already not getting pay rises. It's why as she's
on the money, we're going to be going into even
more career content because I'm getting so frustrated with people
(21:49):
just not being paid what they're worth, people not being
able to afford the groceries that they were last year,
people not knowing their worth because they don't have the
confidence to ask, Like I just think that the government
could be doing more for us. But I guess let's
have a quick look back at what indexation has looked
like historically, because indexation is calculated each and every single year,
and basically it's not always the same. So in twenty eighteen,
(22:14):
indexation on our help debt was one point nine percent.
In twenty nineteen, it was one point eight. In twenty twenty,
it was one point eight. In twenty twenty one, it
was zero point six percent. In twenty twenty two it
was three point nine. So it increased, and the reason
it increased is because inflation in general was increasing, And
what they do is they take the average inflation rate
(22:36):
for the past two years and then apply that. So
they've done that again this year, and that's why we
are predicting it's going to be seven percent. That number
hasn't come from nowhere. That's come from us going Okay, well,
if the inflation rate last year and the inflation rate
this year is this, This is what that seven percent
looks like and where it's coming from. So that doesn't
mean that seven percent is going to happen again. It
might go back down. And in a perfect world, if
(22:58):
the RBA is doing exactly what they should be doing
by you know, helping to slow down economic growth and
helping to bring down the rate of inflation, next year
it won't be so much. So it won't be the
same thing each and every year, but there's always going
to be a level of indexation that is applied to
help or hex steps, because that's what we signed up for. Sure.
Speaker 4 (23:18):
Okay, if only I had read the te's and c's
before starting a million courses, Yeah.
Speaker 2 (23:24):
I just feel like even if you'd read the t's
and c's, you would have been like, whatever, I don't care.
Speaker 4 (23:27):
That's true. Actually, I could have been like, I don't
know what any of this means anyway, sign up.
Speaker 2 (23:30):
No, No, I'm glad we're best friends now, because I
could just be like your financial fairy god brother and
I could text me and be like, V, is this
a good idea and be like, no, it's not. I'll
like you grateful, I'll probably do it anyway. Let's be honest.
I mean, maybe that's very true.
Speaker 4 (23:45):
It's I'm an old dog and it's going to be
hard to learn new tricks, but we're going to get there.
I think this is a really good time to go
to a quick break and we'll see you guys on
the other side. All right, V, we are back and
ready to talk about help Hex helped it.
Speaker 2 (24:03):
Let's talk about he be Lily girl. You know what.
Sam probably isn't going to cut that out. He's what
he doesn't you know what? Neither do I. Let's move on.
Let's make a song.
Speaker 4 (24:12):
No, let's not this, Okay, sure, let's not. I'm going
to stick to podcasting. Yeah, that's fair. It's a fair
that's a fair career choice.
Speaker 2 (24:19):
That Facebook podcasts. You do have a face of podcast.
Thank you.
Speaker 4 (24:23):
Let's talk about help debt fe I think we were
just about to talk about the interest and I don't
know what these terms mean, but yeah, let's dive into it.
Let Steve dive inte.
Speaker 1 (24:32):
Why not?
Speaker 2 (24:33):
Yeah, So we want to talk about interest again because
I think it's important to touch on it. I mentioned
before that help slash Hex's debt doesn't actually attract an
interest rate, it just has an indexation rate. So it's
basically to take into account the different costs of living
and the way I see it, and I'm not defending
the government on this because I just don't think they
should do it. If I'm being really honest, I just
(24:54):
think that they should wipe it and be kind. But whatever,
they're doing it so that their dollar that they len
to you for your education isn't worthless when they get
it back. Oh those dirty dogs, I know, right, But
like it makes sense if I explain it like that,
Like if I said, hey, Beck, I'll pay for your
your degree. It's thirty thousand dollars, I'd like thirty thousand
dollars back. But as we explained before, a macis cone
(25:17):
in ninety seven is not worth what a macas cone
is today, But the same value is there. They're basically
saying we just want the value of our dollar back
so that we can you know, put that money into
something else and not have it be worthless. And you
kind of go, oh, that makes sense, Like that's a
pretty pretty sexy explain if I borrowed money from a
friend and they're like, oh, yeah, okay, can you just like,
(25:37):
if you want to borrow the money from me, can
you just make sure like there's no additional fees or
charges or anything that get charged to me, because individually,
I shouldn't be missing out if I'm lending the money
to you. And I mean, we're not friends with the government,
But that's okay.
Speaker 4 (25:48):
Actually it's a really good point, and I hadn't thought
about that. I suppose like what would happen to the government.
Will we just like crumble as a society if they
were to just like freeze it and we kind of
paid back the hex stet and it was worth less
than when they lent it to us.
Speaker 2 (26:05):
There's a lot of debate about this, but I mean
that's probably why the Greens got so up in arms
and they were like, it's not going to impact it,
Like I feel like from my perspective, and I mean
I've shared this perspective on the podcast before. We're so
lucky to live in Australia, right, Like, we have a
beautiful economy, we have beautiful infrastructure, we have a really
great healthcare system, we have roads that we can drive
(26:26):
on that are safe, there are rules in place and
there are people to protect us. Right. How good is that?
But there are a lot of things that a lot
of people don't agree with. I mean, we could start
a conversation about the doll we could start a conversation
about how government money is being channeled into the wrong
education places, where could be starting a conversation about how
there are a million schemes that need funding and don't
(26:47):
have it. But essentially, I just think that the government
is maintaining this so that they still have money to
go around because they just don't want their dollar to
be worth less tomorrow than it is today to them.
And they essentially, from my perspective, they're seeing helping you
out as a privilege. They're seeing it as like, Okay,
well I helped beck out, she didn't have to cough
(27:08):
up thirty grand to go to university. I'm gonna just
ask for that money back, and that's a fair way
of doing things. Obviously, the same is not true in
other countries, like in America, like they have to get
very expensive student loans that are worth a whole heap
of money and have a whole heap of interest associated
with them. And then on the flip sides, there are
countries that have a completely free education system. In fact,
(27:30):
Australia used to have a free education system where university
was free, and this wish that happened again. So essentially,
what I think that they're trying to do is get
back the money because they just don't have enough of
it to go round at the moment. And I think
that from their perspective they're doing the right things, but
from a community perspective, I think they could be doing more.
Speaker 4 (27:50):
Amen'sis mic drop.
Speaker 2 (27:51):
I don't know if that's a mic drop. I just
you know what I mean. I feel like we've all
got our own opinions on how things work, and I
just think that that's where it gets political. And this
isn't a political podcast, right. I just think it's a
podcast about doing the right thing and being good people.
And you know, I just think that students and people
who have hex stets are having a bit of a
hard time. What would we do about there? It's not
(28:12):
really yeah, a political conversation for me, it's not going,
oh my god, the Greens a label or liberal like.
The Greens had this idea to freeze indexation for seventy
four billion dollars, and I nodded and smiled and said,
you know what, that's a pretty good idea. I think
people would like that.
Speaker 4 (28:26):
Yeah, absolutely, and I'm sure there will be absolutely no
consequences whatsoever. So at the end of the day, I've
gotten all this information, what does this actually look like
for help loans?
Speaker 2 (28:37):
Obviously I am stouts girl. I've done some maths because
I love to do maths. I also love to stop
the podcast halfway through so I can do some sly
maths and come back. You guys don't have to wait
because we edit all of the waiting time out.
Speaker 4 (28:51):
But Beck does, so I will say patiently.
Speaker 2 (28:53):
You do you smile or nod, But from the first
of June, most Australians with an outstanding student loan debt
will actually see their balance shoot up by hundreds or
even a thousands of dollars. Beck, if the indexation rate
does go up by seven point one percent, So I
calculated that really quickly for you. But I've got a
few examples. So if you've got ten grands left on
your loan, it's going to increase by seven hundred and
(29:15):
ten dollars. For every ten thousand dollars in debt you have,
it will consistently increase by seven hundred and ten thousand dollars.
So if you have a twenty five thousand dollar loan balance,
it would increase by seventeen hundred and seventy five dollars.
Beck And if you had a fifty thousand dollar loan,
it would increase by three thousand, five hundred and fifty dollars.
And Beck, do you want to know how much my
(29:36):
hex STEP's going to be increasing by? Because you know,
we've been a little pervy, we're being a little personal
go on. So I still have eighty thousand dollars worth
of hex step, So I'm going to be slammed with
five thousand, six hundred and eighty dollars worth of indexation. No,
that's a trip for two to Bali.
Speaker 4 (29:52):
At least, yeah, at least please.
Speaker 2 (29:55):
But again, I feel very grateful to have that system
in place, And I mean there's actually no way that
I could have personally afforded to go to university and
get the degrees that I have without the help and
HEXT system. So am I mad that that's the case?
Speaker 3 (30:08):
No?
Speaker 2 (30:08):
Not really. I feel like it's you know, part and
parcel of the system that we are using. I mean,
could I be mad about it? Yeah, it's a lot
of money, but again I think that I'm just trying
to see it from a more positive light of like,
that's the cost of you know, me being able to
get to where I want to be in life, because
Lord knows, I wouldn't have gotten anywhere without those degrees. Amen, Well,
(30:30):
could you be sad about it? I could be sad
about it, Like I could just be a little sad that,
you know, I'm in a bit more debt. But honestly,
I see my HEX debt as something that has helped
me in the past few years. It has got me
to where I need to go. There was a period
of time where it made me feel physically sick when
I logged into my portal because it was more don't
(30:51):
log in. Yeah it was more than one hundred grand,
and I'd be like, whoah, who let that happen? Whose
idea was that, And it's kind of like you. Right
when I started my degree, I just didn't think about
how much debt I was racking up, Like I was
not interested in finance. We've talked about this publicly before
that by the time I was twenty two, I was
in like I think it was forty four thousand dollars
worth of personal debt. Like I was really good at that,
(31:13):
and that didn't worry me at the time until I
started learning more and more about finance and I kind
of was like, oh, I might need to pull my
socks up. This is a lot of money. And like
I got out of that. It took a lot of
work and a lot of time. But it's one of
those things where now things like this mean a bit
more to me because I'm grateful for them. But when
I took them on, I had no concept of what
that would look like for me in the future. And
(31:34):
I think a lot of people are in that circumstance.
Speaker 4 (31:36):
Yeah, absolutely, it is good to know that it hasn't
been this high historically and hopefully won't be the case
in future years.
Speaker 2 (31:44):
It's actually not sustainable if it was in future years, right,
because if it was in future years, you're gonna be
is a bit screwed, babe. Like, there's a lot more
going on than help in hex debt repayments. I promise
if indexation kept up at that rate, there's going to
need to be some serious and the government would get
involved to promise it's okay, and they would drown in
our tears. They would, they would.
Speaker 4 (32:06):
So should people start trying to pay down their helped
it before the first.
Speaker 2 (32:10):
Of June, Beck, you should know better than asking a
personal advice question on this podcast. This podcast is general
advice only, and you shouldn't actually take my advice on
anything because that would be financially irresponsible. I have a
license to uphold Beck. That's fair. Now pretend, but pretend here, Okay,
So there are a few things that I want you
to think about. So first things first, we know that
(32:31):
every single persons situation is different, and if you're stressing
over it but you can't afford it, please stop stressing.
It is what it is. Let's not stress about the
things we can't change, Like, what's the point. Absolutely, if
it's something that is stressing you, then maybe we can
look at it in a bit more depth. But I
think making sure that you're comfortable with that and you
know what it means and how it works is basically
(32:52):
what everyone can do. Whether we contribute more or not
is a different conversation. But given what we've discussed for
the first time in a long, long, long time, it
actually might be worth for some people to be making
extra contributions to their HEX debt. It's something that personally,
I will not be doing, and the reason I'm not
doing it is because I don't need to do that
(33:12):
to achieve the goals that I currently have. So if
my goal was to buy a house, and I knew
that by paying down some of my HEX debt would
mean that my ability to lend more money would increase them,
maybe it would be worth it for me. Maybe I
could do that. But if you're in that circumstance shameless
plug for Zella Money, please go. We'll put the link
in the show notes to talk to one of our brokers.
(33:33):
If you are in the position to be purchasing a house,
or you think you're in the position to purchase house
and you're thinking about your HEX debt repayments, go and
talk to a mortgage broker so that they can look
at your whole circumstance, and they can sit you down
and be like, yep, back in your situation, it would
do this for you, and you go, great, I will
do that. Can I tell you that on a podcast?
Unfortunately not. But what I can tell you is that
(33:55):
it might change it for some people, it might not
because it's going to depend how much text debt do
you have, how much can you afford to repay? What
is your current deposit for the home that you're looking
to buy? Do you have a Garran tool loan? What
do all these things actually mean for you? There's no
one size fits or response to that, and I am
very sorry. I wish there was. Did it make content
creations so much easier?
Speaker 1 (34:16):
Oh?
Speaker 2 (34:17):
Fuck you? Just make the podcast be like, all right, guys,
so indexations coming out first of June. This is what
we're going to do.
Speaker 4 (34:22):
These are the rules, These are the answers.
Speaker 2 (34:25):
Beck, You're going to do X and if you're not
in exposition do why do? How much easier content creation
would be? The community would love it? But do you
know what, You've got to do some of the work yourself.
Speaker 4 (34:35):
Unfortunately, unfortunately, but.
Speaker 2 (34:37):
The girls that Zella Money can basically do that for
you and kind of calculate it based on your personal circumstances. Also,
they'll do it for free, so that's kind of a
money we Oh my god. As I said, and I've
said a million times before, I would always prioritize paying
off personal debt first, so things like personal loans and
credit cards and any other personal debt. I would also
(34:59):
look at bumping up your emergency fund, because your emergency
fund is going to be that fund that means that
you can get out of a pickle real quick. Someone
the other day called it a squirrel fund, and I
thought that was real cute, because like squirrels, they're like
hide away all their nuts for the winter, and then
they live off their nuts in the winter when things
aren't as good. That's what how emergence. That's very cute. Anyway,
(35:21):
we want a squirrel fund. We want to make sure
that we're not in any personal debt, and at that
point we can consider whether making additional contributions to our
hex or help debt is a good idea. Perfect Again,
it's going to depend on whether you're going for a
home loan or not as to whether that is worth
it or you know, what could just be stressing the
but Jesus out of you, Beck. You could be so
stressed over your heck's debt, and no matter how many
(35:43):
times you listen to me or how many times you
listen to other podcasts, it's just something that keeps you
up at night. Maybe making additional contributions to something that
fits within your goals makes you feel good. You do you, sis,
you do you, You do you. But what I want
you to be able to do is tell me what
your payments are, what they look like, how it impacts
you as an individual, what it actually looks like if
(36:03):
you paid off more debt. Because a lot of people
might go, I really need to get rid of my
hex step before I get a home. That's actually not true.
I bought a house with a one hundred thousand dollars worth
of hex step. We work with people every single day
that have very large hex stets and still get homes.
That's company. So it's really important to understand that doesn't
need to be completely diminished before you do that. That's
(36:26):
why I want you to talk to a broker, because
the amount of people that I have spoken to that
are like, oh my god, vee, like I've paid off
eighty thousand dollars worth of my hex stet. I go
far out, that's so sick, like, that's so good, And
then they say, so I'm going to now start saving
for a house, and I kind of go, oh good,
smile a nod like, because there's nothing I can do
about that circumstance. But in reality, if they had the
(36:48):
capacity to pay off an eighty thousand dollars home loan,
they had the capacity to save eighty thousand dollars, and
they could have probably already been in a house and
just started paying off their hextet a bit more now
that they have the property. And obviously, when it comes
to investing, the sooner you're in the market, the more
time you have for compound interest to play into it.
And sometimes that's the best outcome. Am I saying that
(37:09):
that's right for every single person? No, But that's why
you need to be educated, because if you're stressing about
your hextet, I can almost guarantee that the reason you're
stressing about it is because you don't know enough about it.
You don't know the semantics of that hexel help debt,
but you also don't know how it impacts you financially,
and that makes people stressed. So talk to someone, listen
(37:30):
to some more podcasts, go and talk to a mortgage
broker about how that actually impacts you, because Beck, you know,
we calculated what your hex step looks like and how
much you're paying back. You're like, yeah, okay. I feel
like you said yep, okay, because that was about what
you expected anyway, Yes, you were fine with that, and
you're also not looking into any other big goals. But
(37:51):
would you be stressed about it if you were on
the home buying process and you're like, oh, I don't
know what that looks like.
Speaker 4 (37:56):
If I didn't know, and I guess I don't really
know that much kind of do now about it. I
do the whole podcast, but I wouldn't know the process
of like buying a house very well. But the idea
that you have a debt might make you stress. I
think about achieving something else. I think that would probably
stress me out a little bit. More money MO problems.
Speaker 2 (38:15):
Exactly exactly, but essentially, I guess the crux of this
is I just want you guys to be educated. I
hope that this has given you the level of education
that you deserve, but also there are going to be
a whole heap of resources on our Instagram soon. I'm
probably going to make a whole heap of tiktoks because
I keep being told off by the cheese. The TikTok well,
I don't. I don't love making them, but my team
(38:35):
keep bullying me into making more, so I will do that.
But I just I want you to be in the
best possible position to make the best decision for you,
and that is honestly all I can do.
Speaker 4 (38:45):
I love that visa anything else before we shut this down?
Speaker 2 (38:49):
Yeah, okay, so first things first. Obviously, education is the key.
I could go on about it forever. If you don't
know what's going on with your HEX or help debt,
you can check it through your mygove login. That's just
like the Tax Officers online platform. You guys should know
what my guve is. If you don't, please google it
and make sure that you log into that and have
a look, because that's not just got your HEX, it's
(39:09):
got your tax information, it's got your Medicare information. It's
kind of like your personal hub. The simplest way to
make your repayment on Hex is actually just through bepay
it's so easy. I'm not saying go do it right now,
but what I am saying is, like, I think a
lot of people assume it's this really complex process. It's not.
It's just a be pay for repayment, like you just
transfer it like you would be transferring your mate when
(39:31):
they bought the pizza. Easy, really easy. So if you
are considering making a repayment and you're like, oh, I'm
really stressed about this, or I only have a little
to go rah rah, make sure you're making that repayment
well before the end of May to make sure it's
processed in time to avoid any additional indexation that might
be applied to that. So just be in really early
because when it happens, it's going to happen on the
(39:51):
first of June, so you want to make sure that
you are getting that payment in asap. If that is
your plan.
Speaker 4 (39:57):
I love that.
Speaker 2 (39:58):
I'm done. Are you done? I could keep going on
and on, but I think we need to be done,
and I could keep listening. No, you couldn't. You're sick.
You are so sick of me.
Speaker 4 (40:07):
I think it's lots of absorbed. Let's go and have
a little tea.
Speaker 2 (40:10):
You have a little walk. We deserve Yeah, I think
we deserve a treat.
Speaker 4 (40:13):
I think we just have a treat.
Speaker 2 (40:14):
Everybody deserves a treat. Have a good day. We will
see you guys on Friday.
Speaker 4 (40:18):
See you soon bybe.
Speaker 2 (40:25):
The advice shared.
Speaker 3 (40:26):
On She's on the Money is general in nature and
does not consider your individual circumstances. She's on the Money
exists purely for educational purposes and should not be relied
upon to make an investment or financial decision. If you
do choose to buy a financial product, read the PDS
TMD and obtain appropriate financial.
Speaker 2 (40:44):
Advice tailored towards your needs.
Speaker 3 (40:46):
Victoria Divine and She's on the Money are authorized representatives
of money sirper Pty Ltd ABN three two one IS
six four nine two seven seven zero eight AFSL four
five one two eight nine
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