Managing Your Home Loan Over Christmas and Into the New Year

Managing Your Home Loan Over Christmas and Into the New Year

As the year winds down, many Aussies start to feel the financial squeeze. Christmas spending ramps up, work slows for some, and suddenly cash flow feels tighter than usual. On Hot 91.1’s Hot Property, Jade caught up with Paul from BrokerCo to talk about managing home loans during the festive season, making smart repayment choices, and setting yourself up for the year ahead.

“It certainly feels that way, I think everyone’s cooked,” Paul laughed, acknowledging how stretched many people feel at the end of the year. But when it comes to money decisions, Paul says this is exactly the time to pause and think strategically.

Should You Reduce Your Repayments?

Jade shared that her bank recently prompted her to reduce her repayments after a rate drop, something many borrowers are seeing right now. Paul explained: “It’s a nice gesture from the bank to offer that to you. Cash-flow wise, that can be helpful depending on your circumstances.” However, he was quick to add the trade-off: “If you lower your repayments, you’ll generally be in that loan for longer and make up the difference over time.” In short, it can ease pressure now, but it often costs more in the long run.

Keeping Repayments Higher Can Pay Off

Rather than dropping repayments, Paul encourages borrowers to look at the bigger picture.“You want to have as much of your money sitting in that loan environment as possible, reducing interest payable against the loan,” he explained. Any amount paid above the minimum doesn’t disappear, it builds up in redraw. “Everything you pay in excess of the minimum repayment is always available to you,” Paul said.

Redraw as a Forced Savings Strategy

Jade summed it up perfectly, calling redraw “almost like a forced saving method.” Paul agreed:
“It’s out of sight, out of mind, unless situations change and you actually need to access those funds.” That means if Christmas expenses, holidays, or unexpected costs pop up, you may already have a buffer sitting there, without having increased your spending habits.

Preparing for the Year Ahead

Looking into 2026, Paul stressed the importance of preparation over prediction. “There’s always whispers of potential rate increases,” he said, before quickly adding, “and that can always shift.” What doesn’t change is the value of being ready. “Anything you can squirrel away is going to be helpful,” Paul noted, along with making extra repayments where possible and tidying up personal debts like credit cards and personal loans. With strong property growth in recent years, many borrowers now have equity they can lean on if needed, reducing stress and creating flexibility.

Thinking Ahead This Christmas?

Whether you’re looking to free up some breathing room over the holidays or want to head into the new year feeling more confident about your finances, BrokerCo can help you review your loan and explore your options. Reach out to the BrokerCo team to see what small changes could make a big difference, now and into the year ahead.