Noel Whittaker's October newsletter looks past the Reserve Bank's next decision and asks a more useful question: what happens to your plans if money stays expensive for a while?
The Reserve Bank lifted rates again at its last meeting, and Noel Whittaker notes there are strong hints of more to come. His point isn't to forecast the next move. It's that interest rates have become almost the only lever used against inflation, and the roughly one in three Australians carrying a mortgage wear most of the weight of it.
If you're somewhere between 40 and 60, you may be in the awkward middle: a home loan that still has years to run, and a growing pile of super and investments you're counting on later. Push rates high enough for long enough, he warns, and you risk tipping the economy into recession - he reaches back to Paul Keating's "the recession we had to have" to make the point. He doesn't expect one any time soon. But he does think it's worth being ready for a bumpier stretch.
His practical advice is refreshingly unglamorous, and it comes down to two things: stay current on the mortgage, and keep enough set aside that a bad year doesn't force your hand.
Make sure your mortgage payments are up to date and that you have sufficient funds available to cover at least three years of planned expenditure.
That second part is the one most of us skip. The real danger in a downturn isn't the fall itself - markets have recovered from every one so far. It's being forced to sell shares or managed funds at the bottom to cover ordinary bills, because there was nothing else to draw on. Three years of expenses in reserve buys you the one thing no investment can: time to wait it out.
It's worth asking yourself the question plainly this week. If your income dropped, or your repayments rose again, how many months could you cover without touching your growth assets? If the answer is "not many", that's useful to know now rather than later.
Read the full article: Interest Rates, in Noel News October 2026 - Noel Whittaker, Noel News, October 2026.
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