Cost-of-living savings tips: Brisbane family’s secret to belt tightening to handle interest rate rises

Thousands of families across Queensland are lying in the path of a major interest rate avalanche, as their fixed-rate mortgage periods come to an end. Here’s how to absorb the price hit.

Queensland families are being forced to adapt their day-to-day spendings as cost-of-living pain continues to bite.

Many homeowners have seen their loans balloon due to skyrocketing interest rate rises, including the Rizk family whose payments have increased by an extra $250 a week after their fixed mortgage rate of 2.24 per cent expired and jumped to 6 per cent.

Ramee Rizk, his wife Reem and two kids Joey and Leon live in Augustine Heights and have had to rein in their spending in preparation of the increase that will hit their budget soon.

“There is going to be an increase in our mortgage payments, which we are concerned about, it means we have to budget a bit more and tighten up on our spendings to make up for the extra cost,” Mr Rizk said.

Reem and Ramee Rizk, with their children Joey, 5, and Leon, 2, at their home in Augustine Heights, Brisbane. Picture: Lyndon Mechielsen/Courier Mail

The family have changed from dining out and eating takeaway from three to four times a week, down to about once a week.

“We are holding back on the takeaway coffees and the wining and dining.

“We are changing from going to those high end places where you spend $200 to $300 for the family, to alternatives like Sunnybank’s market square that’s got good food and it’s cheap,” he said.

“Instead of eating out in the city, we are finding some affordable local restaurants in our area in springfield that are family run not too expensive.”

Their buying habits have also changed at the grocery stores.

“We are buying essential items, not necessarily what we want or impulse buys,” he said.

“We are changing to the generic brands, as a means to save money. Sometimes the bigger supermarkets can be very expensive, the cost of everything is going up, even groceries.

“We have now been shopping at Aldi because we find they are cheaper. They have alternatives, so we are going for the more generic brands.”

Ramee and Reem Rizk, with their children Joey, 5, and Leon, 2, are trying to save money to help with mortgage interest rate rises. Picture: Lyndon Mechielsen/Courier Mail

Mr Rizk has also stopped spending $50 on coffee a week to buying a coffee machine. But other expenses they are trying to save on is family friendly activities.

”Fortunately for us there’s a lot of free things to do here in Springfield, we have a lagoon which is a public pool, a very nice parkland and local parks,” he said.

Mr Rizk’s wife has also shopped around for a new gym membership to bargain on the cheapest deals.

But one trick up Mr Rizk’s sleeve is quite old school.

“Money tins are really good. I’ve been doing it since I was a kid and find it very effective,” he said.

“If you have it for a year, I think that’s an effective way of saving.”

Madd Loans mortgage broker George Samios said there were some options that could alleviate the pressure for families like extending a loan term from 20 to 30 years or changing to an interest only loan for a little bit.

“This is not a forever thing, this is a cycle and eventually it will come down a bit,” he said.

But Mr Samios said people had to look at the non negotiables and live without some negotiables for the moment.

“Your mortgage, your food bill, your car registration, your fuel, telecommunications like phone, these are the essentials,” he said.

“The non-negotiables are the high ticket items like going to fancy restaurants, buying expensive clothing.”