VetPay named and shamed in Choice Shonky Awards


First homebuyers set to embrace First Home Buyer Choice, financial advice puts investors ahead by 5.8%, and pet finance product called out as shonky. Here are five things you may have missed this week.

Two out of three NSW first homebuyers likely to choose annual fee over stamp duty

The proposed First Home Buyer Choice scheme that will let NSW first homebuyers pay an annual property tax instead of lump sum stamp duty is before the NSW Parliament - and it looks set to be a winner.

vetpay shonky award

First homebuyers in NSW are exempt from stamp duty if they pay less than $800,000 for a home, and this will continue to apply.

However, for those paying over $800,000, First Home Buyer Choice stands to deliver substantial savings.

Treasury data shows that on a home costing $1 million, a first homebuyer could pay $40,090 in stamp duty - or property tax of just $2,200 in the first year.

Even if the buyer holds onto the home for 10 years, the annual property tax could add up to $19,881 - still $20,209 cheaper than stamp duty.

Not surprisingly, Treasury analysis shows two-thirds of first homebuyers with a buying budget above $800,000 will likely opt for the annual property fee.

If passed by parliament, First Home Buyer Choice will kick off in 2023. An online calculator is available through Service NSW that lets first homebuyers assess their options

Financial advice delivers 5.8% gains

Australians who use a financial adviser are 5.8% better off each year compared to non-advised investors according to the 2022 Russell Investments Value of an Adviser Report.

The 5.8% figure is based on the value of several factors including behavioural coaching (2.9%), appropriate asset allocation (1.6%) and tax planning and investing (1.3%).

Neil Rogan of Russell Investments, says, "Advisers continue to remain extremely valuable to their clients in 2022", adding that advisers have helped their clients remain invested through the turbulence of the pandemic.

Nonetheless, the cost of financial advice is likely to be a stumbling block for many Australians.

According to Adviser Ratings, in 2021 the median annual fee for advice jumped by 16% to $3,256.

The rising cost reflects declining numbers of financial advisers, partly due to new educational requirements introduced following the banking royal commission.

Adviser Ratings says adviser numbers dipped below 16,000 in October. With more advisers expected to leave the industry by the end of 2022, the cost of formal advice could climb higher.

VetPay cops a Shonky Award

Last year, Money looked at whether pet insurance is worthwhile, noting that 16% of pet owners have taken out cover to protect against expensive vet bills.

An alternative to pet insurance is VetPay, which has just been named and shamed in the annual Shonky Awards published by consumer group CHOICE.

VetPay is a loan product aimed at helping pet owners pay vet bills. It may offer a second chance at life for Fido, but it can see owners paying a lot more than the vet's fee.

"CHOICE is awarding VetPay a Shonky for profiting from people's concerns when their pet is sick," says CHOICE head of policy Patrick Veyret.

CHOICE found that VetPay markets its loans as 'affordable', yet it charges a $49 annual fee, a $2.50 fee every time you make a repayment, and an annual interest rate of 18.4%.

All this sees CHOICE describe VetPay as "one of the more expensive credit products we've seen".

A chance to cut Christmas costs by over $660

With just seven weeks until Christmas Day, research by Aldi shows three out of four Australians expect their spending to skyrocket this festive season.

Aldi claims the average family buying the cheapest products can save $418 on groceries in the run up to Christmas by shopping at Aldi. Those savings can climb to $663 if you're in the market for branded products.

Aldi may not be everyone's preferred choice - it has no rewards program, and offers a smaller product range than Woolies or Coles.

But as Oliver Bongardt, Managing Director, ALDI Australia points out, "Australians go out of their way to find cheaper petrol, or cut down on items that might be considered a luxury". With the biggest spending season of the year approaching, it's worth comparing prices at supermarkets to make your money stretch further.

One in two small businesses vulnerable to cyber threats

First Optus, then Medibank, and more recently, the Australian Defence Force has faced a data breach.

Hackers have been super busy this year, and Australia's 2.4 million small businesses are likely to be more vulnerable to cyber-attacks than their larger counterparts.

Research by small business lender OnDeck Australia, found one in two small enterprises are concerned about cyber security threats, yet only 46% have prepared for an attack.

A separate survey by the Australian Cyber Security Centre (ACSC) found almost half Australia's small businesses spend less than $500 annually on cyber security.

ACSC's Dr Derek Bopping says, "A cybercrime incident is reported to the ACSC every eight minutes. We see the impact of cyber security incidents each and every day, on individuals, small businesses and large companies."

In response, the ACSC has worked with the Commonwealth Bank to produce a Small Business Cyber Security Guide.

It helps businesses prepare for, and act against, online threats, and it can be downloaded free of charge from, or via the Commonwealth Bank.

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A former Chartered Accountant, Nicola Field has been a regular contributor to Money for 20 years, and writes on personal finance issues for some of Australia's largest financial institutions. She is the author of Investing in Your Child's Future and Baby or Bust, and has collaborated with Paul Clitheroe on a variety of projects including radio scripts, newspaper columns, and several books.