A cash rate cut at next week’s RBA board meeting would be a lifeline for mortgage holders looking to get their savings back in the green. According to a Compare the Market survey of over 1,000 Australians, around a third (29%) would use relief from a cash rate cut from the RBA next week to boost their savings amid the ongoing cost-of-living crisis.*

Monthly repayments on an average $642,000 loan with a variable interest rate of 6.3% could reduce as much as $104 – or around $1,248 over the course of the year if the banks pass on a 0.25% cut.**

Compare the Market’s General Manager of Money Stephen Zeller said any rate cut would be a real help to Australians who have been hit hard by repeated rate increases in the past and a general increase to the cost of living.

“Australians are desperate to get their savings out of the red and a potential rate cut from the RBA could help some mortgage holders pocket more than $100 a month or $1,200 a year,” Mr Zeller said. “That’s a significant saving – especially when we’re being hit with health rate rises this week, facing higher energy prices and forking out more for groceries.

“But we can’t depend on the RBA to pass on another rate. It’s up to homeowners to take back control of their mortgages and negotiate better rates for themselves.

“There are some competitive offers available now and if your current lender won’t match these advertised rates, it may be time to walk.

“A cashback may also help sweeten the deal, with offers of between $2,000 and $3,000 available now. So, whether the RBA gifts us a cut or not, there are ways to save.”

Meanwhile, over a quarter of respondents (27%) said they’d keep their repayments the same, while 21% would put the extra funds into an offset account.

“Keeping your repayments the same after a cut is a great way to pay off your loan faster. By paying off more principal, you’ll reduce your loan size and the interest you pay over the life of your loan,” Mr Zeller said.

“You may need to actively change your repayments and set an amount above the minimum repayments for this method to work.

“Similarly, offset accounts have the potential to help you save on interest. You may pay a fee for the privilege but unlike a savings account you won’t pay tax on the interest you offset.

Compare the Market’s survey also found around a quarter of mortgage holders surveyed (23%) planned on spending the extra money from a rate cut on things like groceries (14%), holidays (3%), health and beauty (2%) and social activities (2%).

Mr Zeller’s top tips to save more – regardless of whether there’s a rate cut on Tuesday.

Refinance your home loan if you’re seeing better deals

Search for home loans with lower interest rates, cashback offers or home loan features like offset accounts, redraw facilities, the option to split your loan or make additional repayments. It doesn’t make sense to pay a cent more than you need to on your home loan.

Sniff out a better saving rate

You may be able to earn more interest by moving to a savings account with a better interest rate. Be aware that you may need to meet conditions to earn interest and competitive interest rates may only apply for a limited time.

Ask yourself if you’re paying more than you need to for insurance and utilities

Whenever a utility bill comes in or you receive an insurance renewal, make sure you put the price under the microscope. See if there’s a better deal available by comparing and never just accept the price from your current provider.

*Survey of 1,007 Australian adults, conducted March 2025.

**Calculations assume an owner-occupied loan of $642,000 with a variable interest rate of 6.3%, 30 year loan term, with no ongoing fees. Monthly repayment calculations assume the lender has passed on the rate cut in full and do not take into account the reduction of the loan balance over time.

For more information, please contact:  

Phillip Portman | 0437 384 471 | [email protected]

Compare the Market is a comparison service that takes the hard work out of shopping around. We make it Simples for Australians to quickly and easily compare and buy insurance, energy, and home loans products from a range of providers. Our easy-to-use comparison tool helps you look for a range of products that may suit your needs and benefit your back pocket.

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