Happy New Year to you all. Welcome to 2011 and the first Negotiator eNews Email for the year.
We hope you had a safe and well-rested holiday break and that no one was affected by the very sad news of the flooding in Queensland.

The Reserve Bank of Australia do not meet in January, therefore the interest rates remain as they did in December 2010.

Last year was full of excitement and milestones. With the growth of a strong Australian dollar hitting parity with the US dollar, the continual recovery from the Global Financial Crisis, and the healthy state of the Australian property market, it’s been a successful year for many Australians.

The first half of 2011 looks to be a time of stability as Australia’s residential property market moves into a period of consolidation. After a couple of years of steady gains in home prices the market looks to be taking a breather, with all indications pointing to the market rising around April/May of this year as housing stocks become depleted and demand increases. This is a time when investors have the opportunity to set themselves up for the next stage of the property cycle.

Procrastination and not taking action to invest can be costly in the long run. Even if you put cash under your mattress and don’t spend a cent, each year that money becomes worth, on average, 3% less due to inflation. Another example is, if you won $1 million in Lotto and put that whole amount in a hole in your backyard, with the plan of taking it out in 30 years to pay for your retirement. In 30 years, all of your $1 million will still be there, but it will buy only $400,000 worth of goods.

Before investing, it’s important to have a budget in place. Do you really know what your income is and what all your expenses are? The Australian Securities and Investments Commission (ASIC) have a great budget planner on their FIDO website.