Things you should do, now that interest rates are lower
The slight drop in the repo rate is a good thing for ordinary South Africans because it means that banks will charge less interest rates on prime-linked loans.
The South African Reserve Bank's (SARB) Monetary Policy Committee has voted for the reduction of the repo rate, cut down from 6.5% to 6.25%.
Most of us with debt now pays a little less per month - but this does not mean we should go spend it.
It's important to understand how a little bit makes a lot of money over time. On a million rand mortgage over 20 years you will now save R165 per month. You could go out for dinner.... or phone the bank right now and tell them I want you to keep my instalment exactly the same -don't drop it by R165. That will knock off a whole year off your repayment and save you 76-thousand- rand!Maya Fischer-French, finance journalist
If we see another cut suddenly you've knocked off another year. Let's face it - a R165 a month is probably not going to change the world, but over a year it is significant.Maya Fischer-French, finance journalist
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This article first appeared on 702 : Things you should do, now that interest rates are lower
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