In recent weeks a raft of new laws have been introduced that should boost the financial wellbeing of many Australians.
For new parents and parents-to-be, one of the most significant developments is the arrival of government funded parental leave.
Paid Parental Leave is available for working parents of children born or adopted after 1 January 2011. The payments are pegged at the national minimum wage of $570 per week (before tax) and they run for 18 weeks.
New parents will need to meet eligibility requirements to receive the payments. In particular the parent applying for Paid Parental Leave must have earned less than $150,000 in the last financial year.
There is also a work test. Whoever takes time off to be with the baby (that’s usually mum) must have worked for at least 10 of the 13 months prior to the birth or adoption of the child, for at least one day a week.
I reckon this initiative is a great step forward for new parents. It means you can take more time off work to be with your newborn while getting a valuable helping hand to meet the costs of your new family member.
For more information visit the Family Assistance Office website at www.familyassist.gov.au
Also from this month, Australian consumers have the benefit of a uniform set of consumer laws that apply nationwide.
This development may not impact your day to day life but it makes a lot of sense to have one set of laws that apply to all Australians rather than the 20 different pieces of legislation that previously applied across our states and territories.
For you and me it means that no matter where in Australia we purchase goods or services, the same rules will apply to things like warranties, lay-bys and product safety.
New Years day also heralded the arrival of responsible lending provisions for banks, building societies, credit unions and finance companies. These rules have already been in place for other industry groups like brokers since July last year.
Under the new provisions, if you apply for a credit card, home loan or other type of finance, the lender has a legal obligation to check that you can realistically handle the repayments.
It’s something many reputable lenders have done all along. But it means people who are borderline in terms of their ability to repay a debt are more likely to have their application for credit knocked back.
In theory this isn’t a bad thing. Borrowers who are likely to struggle with debt won’t be able to get themselves into financial difficulty.
However the concern is that the sharks of the money world will look for a way around the rules and exploit people whose credit applications are rejected by reputable financial institutions.
If you do get a loan or credit card application rejected, you have to be honest with yourself about how well you could really handle the debt. It’s far better to get your finances in order and reapply for credit at a later date than get deep in hock with a shonky lender charging over the top fees and interest.