Student debt rising

Photo: Andrea Piacquadio @Pexels

The average higher education (HELP) student debt stood at $23,280 in the year to June 2020, compared with $14,401 in 2011.

Student debt has been rising steadily and so has the time needed to pay it off, 9.3 years from 7.3 years in 2005.

There are 2.85 million HELP debtors.

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Private health complaints drop but COVID issues increase

Complaints to the regulator about private health insurance dropped by 14.5% in the June quarter (year-on-year), probably because consumers could not access their benefits due to COVID-19, says the Commonwealth Ombudsman.

There was, however, an increase in complaints that could be related to COVID-19 and the hardship it has caused.

“We observed significant and rapid changes within the industry over this period due to consumers experiencing financial hardship and being unable to access planned hospital treatments and routine general treatment services,” says the Ombudsman’s latest report.

Most health insurers deferred their April 1 premium increase for six months and introduced measures to help people struggling to pay for cover.

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Many brands, little choice in insurance

Four major insurers dominate the Australian general insurance market, which gives the appearance of choice with the offer of many brands, says the Productivity Commission in a report on competition in the financial system.

The four majors underwrite more than 30 brands while two of the smaller insurers underwrite 50 brands between them. One company underwrites 23 of 25 pet insurance brands.

In some areas of financial services, proliferation of products with slight variations in features has become a burden for providers as well as consumers, says the report.

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Should expense claims be scrapped in favour of a standard tax deduction?

About 75 per cent of Australians lodge their tax return via a tax agent, many unnecessarily, because the tax system is complex and difficult to understand, a parliamentary inquiry has heard.

The Tax Institute says individuals with straightforward affairs don’t need a tax agent but find the system hard to access and cannot sort misinformation from correct information so feel they need to pay for expert help.

The Institute applauds the ATO’s move to electronic communications but says it could be improved by the ATO pre-filling as much information as possible and more transparency in data collected.

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ACCC calls for a better deal for car buyers and repairers

Australian households spend 5 per cent of their annual income on their cars. That figure includes buying and maintenance, making a car the second most expensive purchase after a house.

Despite the cost, and the fact that many people need a car to work, the consumer legal protections for new car buyers can be difficult to enforce, and for consumers to understand, finds a report from the Australian Competition and Consumer Commission (ACCC).

The consumer watchdog’s draft report into the new car retailing industry calls for regulation to ensure car manufacturers provide technical information to independent repairers.

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Life insurance comparison websites: what they don’t offer

Comparison websites provide the convenience of being able to compare different products online, and many of us would assume what we get is the same as buying a bespoke service. When it comes to life insurance we’d be wrong.

Research by Rice Warner has found the commissions that insurers pay to life insurance websites is the same as that paid to qualified financial advisers who spend time assessing the consumer’s needs to come up with a tailored offer of cover.

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