Is your bank reducing interest rates this August?

In May, your bank passed on the RBA rate drop when the cash rate dropped to a record low 1.75%. A few days ago, the RBA has announced that there would be a further 0.25% reduction to the cash rate, taking it to a staggeringly low 1.5%. While most banks passed the May rate cut in full, it appears the banks will only be passing on a portion of the rate cut this time round.

So far, of the following banks, Bank of Queensland has announced the biggest cut at 0.15%, followed by Westpac and St George at 0.14%. This is also consistent when looking at the aggregated cut from May and August – with BoQ leading the pack at 0.40%. Westpac again leads the majors at 0.39%. The poorest performer overall is ME Bank, only passing on an aggregated 0.15% across May and August.

Another key aspect of the rate cut to observe is the the speed at which the banks pass it on. ANZ is the speediest, passing on the rate cut 10 days after the May RBA announcement and similarly, 10 days yet again after the August announcement. This is almost 2x better compared to the other banks which typically pass on the cuts with a lag-time between 34 to 41 days in aggregate.

To be kept in the loop for future home loan rate changes on your own loan and any RBA rate decision movements, try Pocketbook Home Loan Insights. You will get alerted when the interest rate on your home loan changes and see how much it has changed and what that means for you.

Bank Date of cut Size of cut Total cut
(May & Aug)
Total days after announcement
ANZ 12 Aug 0.12% 0.31% 20
Bank of Melbourne 23 Aug 0.13% 0.38% 41
Bank of Queensland 31 Aug 0.15% 0.40% 44
BankSA 23 Aug 0.13% 0.38% 41
Bankwest 23 Aug 0.10% 0.30% 38
Bendigo Bank 19 Aug 0.10% 0.30% 44
Citibank 23 Aug 0.15% 0.36% 41
Commonwealth Bank 19 Aug 0.13% 0.38% 34
CUA 18 Aug 0.10% 0.35% 32
HSBC 22 Aug 0.12% 0.37% 40
ING Direct 15 Aug 0.12% 0.37% 30
ME Bank 23 Aug 0.10% 0.15% 34
NAB 19 Aug 0.10% 0.35% 30
St George 23 Aug 0.14% 0.39% 41
Suncorp 14 Aug 0.10% 0.30% 34
UBank 19 Aug 0.10% 0.35% 30
Westpac 23 Aug 0.14% 0.39% 41

When is your bank dropping your interest rate?

The recent interest rate drop from the RBA came as surprise to many experts. Since then, all major banks have announced that they are passing on the rate cut either in part or in full.

The majority of the banks are dropping rates around 0.19% to 0.25%. With ANZ having the lowest rate drop of all the majors with 0.19%, and ME Bank dropping the least – a tiny 0.05%.

While a drop of 0.25% may not seem like a huge amount, it can make a sizeable impact on the amount of interest you pay in the long run. On a $300,000 loan over 20 years you would pay an extra $13,000 in interest at 4.5% versus 4.25%.

To be kept in the loop for future home loan rate changes on your own loan and any RBA rate decision movements, we’ve introduced Pocketbook Home Loan Insights. You will get alerted when the interest rate on your home loan changes and see how much it has changed and what that means for you.

Similarly, banks have also been lowering introductory rates for new loans. From around 4% a month ago to now well below 4%. The standouts in market appear to be in the 3.6% to 3.9% range:

  • – 3.63%
  • UBank – 3.74%

Find out when your bank will drop your rate here. Track future rate changes with Home Loan Insights here.

Bank Date of cut Size of cut
ANZ 13 May 0.19%
Bank of Melbourne 23 May 0.25%
Bank of Queensland 18 May 0.25%
BankSA 23 May 0.25%
Bankwest 20 May 0.20%
Bendigo Bank 30 May 0.20%
Citibank 23 May 0.21%
Commonwealth Bank 20 May 0.25%
CUA 19 May 0.25%
HSBC 23 May 0.25%
ING Direct 20 May 0.25%
ME Bank 16 May 0.05%
NAB 16 May 0.25%
St George 23 May 0.25%
Suncorp 25 May 0.20%
UBank 16 May 0.25%
Westpac 23 May 0.25%

10 ways to make the most out of Pocketbook

It’s 2016. If you are like most people, the new year brings a few resolutions for your finances – making more, saving for something big, or just generally wanting to get a little “better”. Our mission at Pocketbook is to make the process of getting better with your finances easy.

So to start the year, I wanted to share with you some of the best tips and tricks that we talk to users about via our Help service. By following these, you’ll be sure to get more out of Pocketbook in 2016. So here goes…

1. Use the “Transferring Money” category

This is the most frequently asked question for new users – how to make transfers between accounts not over-inflate actual income and expense totals.

This is why we built the special “Transferring Money” category – categorising a transaction as this will exclude it from calculations. The best part of the feature is that because of our learning categorisation algorithm, once you teach your Pocketbook that a certain transaction is a money transfer, it’s almost certain that all future transactions of the type would be automatically categorised correctly as well.

Pro-Tip: Use “Transferring Money” for payments you make to pay off your credit card or your mortgage where your credit card and loan is also sync’ed to Pocketbook.

2. Use the new Overview screen for a snapshot of your finances at your fingertips

A major update we made to the iPhone app is the new “Overview” view consisting of a combination of ‘Tiles’. These Tiles each highlight a different area of your finances – e.g. your budget and what you have been spending on, your balances, how your savings are going (coming soon!) and recent transactions.

Together they give you the best snapshot of your finances you will get anywhere. We’ll be adding to these Tiles throughout 2016 as well so stay tuned!

Pro-Tip: You can tap on each of the Tiles within the Overview page to see more detail. E.g. tapping on the Bills & Income section will take you to the Bill and Income calendar for a more detailed view of what’s coming up and what’s already happened.

3. Pay special attention to all “bank fee” alerts

One of the best features that new users often aren’t aware is that Pocketbook automatically detects bank fees charged to your accounts. The system sends an alert immediately to you via both email and push notification through the app.

We’ve helped hundreds of users reverse incorrectly charged bank fees with this feature. Pay attention and you could save from incorrect charges as well!

Pro-Tip: In the email alert, we’ve included your bank’s phone number there to make things super easy if you need to call your bank to dispute the fee.

4. Using the “#oneoffspend” tag

Sometimes big purchases happen – the big TV or the holiday flights away. As these are typically hundreds or thousands of dollars, it’s important to not have these transactions blur my view of the financial discipline I’m otherwise maintaining day-to-day. The “#oneoffspend” tag caters for exactly this – use this tag to exclude certain transactions from budget calculations.

5. Try the all new Pocketbook Feed

3 months ago, we introduced “Pocketbook Feed”. The Feed is the place where all the most important insights about your finances reside. It’s like an anti-virus software, picking out and showing you anomalies and things you should know.

In December, we added special Subject Areas. These capture timely news and articles about money which may be of relevance to your interest areas such as share investment, property, superannuation or deals – ONLY the areas you are interested in. We curate to the best of the best news so you don’t have to wade through endless junk articles.

Pro-Tip: Try the “Discover” button on the right to follow interest areas relevant to you, and try the “little man” icon on the left to filter only for your personal notification items.

6. Set your Safely Spend a smidgen lower in 2016

Another common Helpdesk query is how Safely Spend should be set and used.

Safely Spend is designed as a running average of your regular discretionary spend – meaning anything outside of bills, one off purchases (marked with the #oneoffspend tag – see 3) and Transferring Money (see 1) categorised between your own accounts. So this includes drinks, dinners, train tickets, groceries, petrol etc. Things that are somewhat more negotiable when it comes to saving.

For 2016 try to set your Safely Spend lower by a few dollars. It’s like virtually lowering your allowance. This should get your resolutions well and truly going.

Pro-Tip: Is there a holiday you’re saving for? Maybe a pet puppy? Try dividing the cost of whatever it is by 52 if your Safely Spend is weekly, 26 if you plan fortnightly, and 12 if you’re a monthly person. Then take that away from your Safely Spend number when you set up. Try it! You’ll have everything to gain.

7. Use the “Apply Only to this Transaction” tickbox

While we continually to improve on our categorisation algorithm, it’s almost impossible to be always accurate. You might have bought a stick of gum from the petrol station instead of your usual petrol or you might have purchased a work related item on eBay.

This is most likely an exception you’d like to better capture, however you don’t want Pocketbook to remember the new categorisation for future similar transactions. In this case, be sure to check the “Apply Only to this Transaction” checkbox when you altering the category.

Pro-Tip: If you make a mistake, don’t worry. There’s a “Bulk Edit” feature on the web version of Pocketbook where you can correct things quickly.

8. Create sub-categories to further sharpen your spending analysis

Sometimes you want to get finer with categorisation. E.g. for the Kids category, adding sub-categories like “School Fees” or “Excursion” or “Uniforms” can help. Pocketbook allows users to do this today, in fact there is no limit to how many categories or sub-categories you can create.

For web users, the way to create a sub-category is by using the format “Category – Subcategory” (using a dash when adding a new category).

Pro-Tip: You can view your sub-category spending breakdowns in Analyse via the web. Just click on the top level category in the pie-chart and the chart will zoom in to show you the sub-categories.

9. Email us if you have any questions

We’re always just an email away. If you have any questions, concerns or comments, just click here and drop us a line.

10. Stay on top of Pocketbook product updates

The Chinese have a wonderful greeting for new years – “Gung Hey Fat Choy!”. Instead of happy new year, they say “wishing you all the riches!”. For us at Pocketbook, we have the same lofty aspirations for your 2016. We want to make it a standout year for you. We will be releasing bigger and better features which I can’t wait to share with you.

Follow us on Facebook and Twitter, and we will update you with the latest and greatest throughout the year.

We hope you all the best for 2016. See you inside Pocketbook!

Netflix is the new king of Australian TV subscriptions for digital natives

EDIT: We have adjusted our claims that Netflix is the leading subscription service today compared to Foxtel upon learning that business customers contribute to only 1% of their 2.8m customer base. We believe it is unlikely that Netflix has already achieved a total user base of 2m+ in Australia. However, given the nature of our sample, we believe our research is an accurate lead indicator for the impending direction of Australian consumer behaviour at large.

Since our Netflix research in July 2014, we’ve seen significant industry changes in the subscription TV sector in Australia over the past 10 months.

After publication, our research caught significant attention from the major the players in the market. A domino effect ensued, including a public appeal from Quickflix CEO against geo-dodging, our data being publicly quoted by the Communications Minister Malcolm Turnbull at a major conference, a subsequent price-drop from Foxtel, and the eventual launch of Presto TV and Stan into the market.

Meanwhile, our estimation that the population of Australians using Netflix via VPN services being more than the 150,000 first estimated by pay-TV executives was confirmed in September by an independent piece of research by Choice Magazine.

All this was a pre-cursor to the launch of Netflix in Australia in late March.

Now that we are a month into the new subscription service, we wanted to again take a look at Australia’s love-affair with Netflix, and if the latest market changes have affected where our money is going. As well as respond to some of the already published data on daily site visits and brand awareness, aggregating de-identified real consumer purchase data.

Continue reading…

Pocketbook for Apple Watch

Last week, Apple officially launched Apple Watch at its Spring Forward Event after teasing the world last September. In the words of Tim Cook, it is the “most personal device” they have ever created. While time will tell if the Apple Watch will ultimately be as ubiquitous as Apple’s other products, the company’s focus and heavy investment may well prove to redefine the smartwatch segment as they have for mp3 players and mobile phones.

Here at Pocketbook, we pride ourselves in giving you, our users the most relevant insights about your money, in the simplest means. When we started Pocketbook over 2 years ago, we thought a web version was the solution – no one would want to manage their money on a mobile phone. How wrong we were looking back now… Over the past 24 months, you have voted with your fingers, and today the majority of usage is on our iPhone and Android apps.

Continue reading…

The Rise and Rise of Uber in Australia

Uber launched in Australia 2 years ago, in October 2012. If you haven’t heard of it, here’s a quick recap.

Uber is a car ride-sharing service backed by Google – it allows you use its app to catch a ride from one of its drivers. Just about anyone with a car can be a driver – not just taxis, but also serviced cars and even ordinary people (like this). The benefit for the average person is simple. Because drivers don’t need to pay for expensive taxi licenses, Uber rides are generally cheaper than taxis (or so they claim).

For taxi drivers, they get the benefit of additional jobs, when they used to just wait at the rank.

However, the taxi industry has been at logger-heads with Uber entering the market. Taxi drivers protested against the service in Perth and the Government is cracking down on Uber’s drivers in Adelaide, NSW and Victoria. Many critics cite the security concerns when anyone and any car can transport the public.

Despite similar critics in the US and in Europe, the consumer reaction has been overwhelmingly the opposite. When taxi drivers went on strike in London, Uber saw an 850% jump in sign-ups. Globally, Uber’s CEO says that they are doubling revenue every six months.

So given our local industry reaction, we wanted to see how ordinary Australians are reacting.

Continue reading…

Lipstick showdown in Sydney – the impending rise of Sephora

Sephora is one the world’s largest cosmetic retail chains. With almost 2,000 stores in 29 countries, the French company is part of the Louis Vuitton luxury goods group and has annual revenues of €1.94 billion. And now for it’s next global expansion it has set its sights on Australia.

The company opened its first Australian flagship store in Sydney on 5th December 2014, just in time for the Christmas rush and Boxing day sales. The store is located at 188 Pitt Street Mall, in Sydney CBD’s main shopping district.  This geographic choice is highly strategic, opposite big department stores (Myer & David Jones), next to fast-fashion poster-child Zara and a stone’s throw away from super-pharmacies (Soul Pattinson and Priceline) that along with the department stores – have long dominated the cosmetic and beauty sectors within the city’s centre, and indeed the rest of the country.

Continue reading…

Choosing a Super Fund: Here’s The Data – An Analysis of The Superannuation Industry

EDITOR’S NOTE: If you don’t read any further, apply these rules of thumb we found by looking at 10 years of super performance:

  1. Go with a fund that pays low fees, high fees is statistically correlated with worse performance.
  2. Go with an industry fund, as more industry funds have historically outperformed retail funds.
  3. And the fund that’s better than all the rest ironically is… REST. So you should start your search there.

In Australia, we all have money in our super. At 9.5% of your salary, it’s actually a lot of money that you probably don’t think about on a daily basis. But you probably should. On top of that, the law of time-value of money says a dollar today is worth more than a dollar tomorrow.

A critical player in all of this is the fund manager that looks after your money – or in other words your superannuation fund. And here’s the reason to care – depending on your choices here, it could mean the difference between doubling your money, or just keeping par. Retiring rich or perhaps relying on Government benefits.

Now, here’s the analysis.

Continue reading…