Your 2021 finances in review

As we approach the end of the year, it’s time to revisit some of the most frequently played money topics. From rising house prices to our obsession with shopping online, we’ve seen some major trends take off in 2021.

So just like Spotify Wrapped brings together your favorite hits of the year, we’ve rounded up the personal finance topics that have most likely colored your news feeds and bank statements. For a little more spice, we’ve paired them up with some beloved and (sort of) relevant songs for the money.

Real estate prices continue to rise

Soundtrack: Country Roads, John Denver

The real estate market in Australia has experienced intense growth in value over the past year, and it has already been rising steadily for quite some time. This means that many new homeowners now have large home loans to repay, while potential buyers compete in a market with record prices.

Along with the shift to remote work during shutdowns, this has led many Australians to relocate to regional areas or urban suburbs for more affordable options – i.e. following country roads to bring them home. . But as you would expect, this change also resulted in higher prices in these areas as more city dwellers moved in, often exceeding prices for locals.

The latest ABS data shows that real estate investor interest continued through the second half of 2021, while first-time homebuyers’ borrowing eased. Some might look to mom and dad’s bank instead of traditional lenders, but others might wait for the drop in house prices slated for 2023. Only time and reading real estate news will tell.

Buy now Pay later goes wild

Soundtrack: Just Got Paid, NSYNC

Unless it’s Friday night and you just got paid like NSYNC, you might not have the immediate funds to splurge on a large purchase. This is where the Buy Now Pay Later (BNPL) platforms come in, offering the possibility of paying for a purchase in installments over a defined number of weeks.

It’s really taken off in Australia – according to a recent study Australians are more than twice as likely to use BNPL as the global average – and many new services are popping up everywhere.

Beyond dedicated BNPL providers, banks and payment platforms are launching their own version of the product. Think Pay in 4 from PayPal, Suncorp PayLater’s BNPL debit card, or Matercard installments – all of which are 2021 variants of the BNPL system where interest doesn’t accrue on purchases (although customers still need to do this). watch out for sneaky fees).

Sustainability takes center stage

Soundtrack: Big Yellow Taxi, Joni Mitchell

Joni Mitchell is right: we paved a large part of Heaven and built a parking lot. But at least we’ve seen some positive efforts in the financial sector in recent times, as the climate emergency was highlighted in red by the latest report from the Intergovernmental Panel on Climate Change (IPCC).

Ethical pension funds that favor the environment in favor of profit have attractive returns, renewables lower home energy prices, and states and territories are pushing the development of electric vehicles further. There is always more to do (and Australia is hardly a global leader on climate change), but understanding how your financial choices impact the planet and making positive change is a step in the right direction. .

The stock exchange train fills up

Soundtrack: Winner Takes It All, ABBA

Like any investment, trading in stocks comes with risk and the winning trade can indeed take it all. But it seems Australians are keen to learn more about this risk, abide by the trading rules and reap the (potential) rewards.

In August, researchers at Investment Trends said the number of people using stock trading platforms was nearly double that of a few years ago. A more recent report from CommBank found that young people continue to lead the way, with 38% of Australians in their millennial age range investing online.

Likewise, the past year has been a roller coaster for cryptocurrencies like Bitcoin, Ethereum, Ripple, and the novel Dogecoin. Throughout the year, the values ​​of various decentralized digital currencies have risen and fallen. But there have also been significant consolidation moves in the cryptocurrency services market in Australia, such as crypto payments embedded in the Mastercard system and crypto services en route for CommBank customers.

The wave of online shopping continues

Soundtrack: If I Had $ 1,000,000, Barenaked Ladies

If the average Australian had a million dollars, he would likely spend a lot of it online. At least that’s what various reports show on our online shopping habits throughout 2021. Understandably, online shopping has increased during shutdowns, but many shoppers also expect Christmas budgets to explode. This year.

So, if you’re looking to limit your spending after the last crazy year of money musical chairs, browse the savings accounts below to find a great place to stash some cash.