Interest rates are rising, and the Reserve Bank of Australia (RBA) has indicated they may remain elevated for longer than expected.
While people who live off their investments, including self-funded retirees, may welcome higher returns, this environment can also influence a broader range of financial decisions.
While often discussed in the context of homebuyers, higher interest rates can also affect those approaching or in retirement. This may include decisions around downsizing, restructuring existing debt, or even supporting family members with property purchases.
Many households put their lifestyles and financial decisions on hold until rates eventually begin to fall, particularly those considering buying property.
This may seem like the safest strategy, but it can also carry financial risks. Property prices are often lower during periods of higher interest rates. This means buying at this time may involve borrowing less, which, over the course of a 20–30 year mortgage, could potentially result in savings of thousands.
For those who already have a mortgage, the government’s Moneysmart website recommends reviewing it at least once a year. This helps identify features and benefits you may not be using, as well as alternative lending options that could better suit your needs, particularly in a higher-rate environment.
We’ve put together a five-point checklist you can use to evaluate your financial position in relation to your current or future housing loan. Some of these points you may have already considered, while others may offer new insights.
As we prepare for what could be a prolonged period of higher interest rates, it’s worth taking the time to review your position carefully.
Before working through the checklist, it may also be helpful to consider how ongoing higher rates could affect your broader financial position.
For those nearing or in retirement, this could include reviewing income sources, managing lifestyle expenses, or planning for changes such as downsizing or providing financial support to family members.
According to a 2025 survey conducted by Finder.com.au, 28% of Australians abandoned plans to purchase property over the previous two years due to high interest rates.
Naturally, one of the greatest challenges when making financial decisions is timing. This is especially true in the property market.
While a higher-for-longer rate environment may feel uncertain, it is possible to reduce some of that uncertainty by focusing on what you can control.
Whether you are considering entering the property market, reviewing an existing loan, or supporting family members with financial decisions, taking a structured approach can help you move forward with greater confidence.
If you’d like guidance in assessing your options and making informed decisions in a changing environment, consider speaking with a financial professional who can help you move forward with clarity.
Key facts and figures in this article are sourced from the following:
- Choosing a home loan “https://www.moneysmart.gov.au”
- Finder’s RBA survey: rate cut could save the average Aussie over $1,236 over a year (Taylor Blackburn, 18 February 2025) “https://www.finder.com.au”
Ascent Wealth Solutions Pty Ltd (ABN 38 685 677 141) is a Corporate Authorised Representative (No. 1314931) of Personal Financial Services Ltd (ABN 26 098 725 145). Australian Financial Services Licence (No 234459)
