One in three Aussies would ditch our cities to work remotely: What you've missed

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Experts predict banks to lift rates out of cycle, and a class action is filed against a2 Milk company.

Here are five things you might've missed this week.

DIY preferred approach among Aussie investors

tree change work remotely

Most Aussies prefer a do-it-yourself approach when it comes to financial management.

The Financial Planning Association's (FPA) annual Money and Life Tracker, which surveyed 2000 Aussies, found that 88% trust only themselves or their spouse or partner with their financial accountability. More than a third believe they did not need advice and could do it themselves, while another 15% said they couldn't afford it

Of those surveyed, only 12% indicated that they are using a financial adviser.

The research was released to coincide with Financial Planning Week in Australia, which runs from October 4-9.

"Our research findings from 2020 showed those who had a financial planner by their side were able to cope more confidently than those who didn't," says FPA chief executive Dante De Gori.

"In light of this, we encourage as many Australians as possible to take stock of their circumstances and explore how a qualified financial planner could help them."

The research also found that 11% of Aussies were in a much stronger financial position compared to last year, and 26% said they had made some changes to their financial situation, with 44.7% vowing to be more frugal about lifestyle choices.

Experts predict rates to lift rates within the next year

Half of the experts surveyed in the Finder RBA cash rate survey expect the big four banks to lift their rates out of cycle within the next 12 months.

"Data from the RBA shows that banks changed their rates seven times during the last stable period,"

"Four of those changes were rate increases - and they may well do it again," says Graham Cooke, head of consumer research at Finder. "Those who aren't on a fixed mortgage rate should stay alert to any changes from their bank, as it could mean substantially higher monthly repayments," Cooke says.

More than half of the experts surveyed (55%) expect the Australian Prudential Regulation Authority (APRA) to implement lending restrictions to slow growth in property prices.

"APRA recently confirmed that they were looking closely at income-to-price ratios. This could be an early indication that lending restrictions are coming," Cooke says.

Meanwhile, a third of respondents believe that the refinancing boom is hurting the banking sector.

According to data from the Australian Bureau of Statistics, total refinancing hit another record high at $17.9 billion in value in July 2021, a 47% increase year-on-year.

While homeowners are eager to make the most of record-low interest rates, lenders are aggressively competing for market share with cashback offers up to $4000," Cooke says. "With many refinance offers getting you a better rate and thousands in cash, it's no wonder Aussies are home loan shopping."

Class action filed against A2 milk

Slater and Gordon has filed a class action against a2 Milk Company, being brought on behalf of shareholders who suffered losses after acquiring a2 Milk shares on the ASX and NZX between August 19, 2020, and May 9, 2021

The class action claims that a2 Milk engaged in misleading or deceptive conduct in breach of the Corporations Act.

The Company is also accused of breaching continuous disclosure rules in posting four downgrades on September 28 and December 18 last year, and February 25 and May 10 of this year.

Slater and Gordon Class Actions Practice Group Leader Kaitlin Ferris says a2 Milk was or ought to have been aware that the full-year FY21 guidance did not adequately take into account the factors likely to impact the Company's financial performance.

"As a result of our investigation following a2's profit downgrades throughout FY21, we concluded that there was a strong basis to allege that the company provided misleading guidance and was obliged to correct the market's understanding of its financial position at a much earlier time," she says.

"Investors are entitled to assume that when they purchase shares in a listed company, all of the material information relevant to its financial position has been disclosed. The repeated downgrades by a2 during August 2020 to May 2021 claim period caught the market by surprise and revealed that a2 had been facing systemic and structural issues with its distribution networks at an early stage of the financial year."

A third of Aussies would move if they could work remotely

A Finder survey of 678 Australian workers reveals that 33%, equivalent to 4.3 million adults, would move if their employer allowed remote work.

"Many Aussies are well adjusted to their new work-from-home routine and are allowing themselves to think outside-the-box now that remote working is mainstream," says Sarah Megginson, home loans expert at Finder.

"The once longed for tree-change and sea-change is becoming a reality for those who are re-evaluating where they want to call home."

Among the states, New South Wales would see the largest exodus with a staggering 40% of residents indicating they would move, closely followed closely by Victorians (37%).

"Not surprisingly, the two states hit hardest by lockdowns are the ones questioning where they call home," says Megginson.

"Plenty of workers are embracing the extra hours gained with the absence of commuting to work, and wondering what else they can do with that valuable time."

Vanguard cuts fees

Vanguard has lowered the cost of several of its Australian fixed interest funds.

Fees on its Australian Fixed Interest Fund and Exchange Traded Fund (ETF) has been reduced from 0.24% to 0.19% and 0.20% to 0.15% respectively, while fees on the Vanguard Australian Corporate Fixed Interest Index Fund have dropped from 0.29% to 0.24% and the ETF from 0.26% to 0.20%.

The Fixed Interest and Corporate Fixed Interest funds aim to provide investors with access to diversified, broad market access to government and corporate-issued bonds.

"Persistently low yields have led some investors to question the role of bonds in a long-term financial plan, potentially overlooking the key function of bonds in a well-diversified portfolio," says Reedman.

"As a defensive asset, bonds serve to cushion an investment portfolio and can help smooth out an otherwise anxiety-inducing ride during periods of market volatility."

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David Thornton is a journalist at Money magazine and is one of the hosts of the Friends With Money podcast. He previously worked at Your Money, covering market news as producer of Trading Day Live. Before that, he covered business and finance news at The Constant Investor. David holds a Masters of International Relations from the University of Melbourne.