Daniel McCulloch
(Australian Associated Press)

Unemployed workers will be given an extra $50 a fortnight once coronavirus supplements are scrapped, but bosses will be able to dob in anyone who turns down a job.

The federal government is boosting the permanent base of the dole to $620.80 a fortnight.

The increase works out to an extra $3.57 a day.

People will also be able to earn $150 a fortnight without affecting their welfare payments.

The measures are expected to cost $9 billion over four years and lift JobSeeker to 41.2 per cent of the minimum wage.

But the modest increase falls far short of the $150 coronavirus supplement, leaving bitterly disappointed welfare groups to describe the boost as a heartless betrayal.

Prime Minister Scott Morrison linked the new rate of JobSeeker to the vaccination rollout, saying it marked a new chapter in the country's response to the pandemic.

"We are moving from short-term emergency measures to long-term arrangements that people can rely on should they find themselves out of work," he told reporters in Canberra on Tuesday.

Mr Morrison described the increase as the single largest year-on-year boost since the 1980s and brushed off criticism from community groups.

"I have no doubt that at whatever rate you set the payment, there will always be suggestions by some that it should be more," he said.

"There'll be some who suggest it should be less.

"That's why a government has to exercise judgment in getting that balance right. Not just in the setting of the payment, but also the conditions that sit around the provisions of that payment."

When the plan was presented to a coalition partyroom meeting, one MP described the JobSeeker increase as unaffordable, and said they could not justify the country going any further into debt.

The modest increase will be paired with much tighter eligibility rules and harsher mutual obligations for the 1.3 million people still on JobSeeker payments.

A government-run hotline will be established for bosses to dob in welfare recipients who are offered a job and do not accept.

Individuals may have their payments docked if they cannot produce a valid reason.

People on JobSeeker for more than six months will have to work for the dole or engage in an "intensive training" program of short courses.

Welfare recipients will have to attend face-to-face meetings with employment agencies and apply for at least 15 jobs a month.

This will increase to 20 jobs a month from July.

Labor will not stand in the way of raising the JobSeeker rate but wants to work through the detail of the additional mutual obligation requirements.

Opposition frontbencher Linda Burney said the government would need to introduce legislation this week if it wanted to change the rate.

"The government has indicated there would be a trade-off between increasing the rate and additional mutual obligation requirements," she told a caucus meeting.

"We want people to live in dignity, we want people to alleviate poverty and we want to get people into jobs."

Greens senator Rachel Siewert described the JobSeeker increase as a cruel joke.

"This is an appalling slap in the face for all those people trying to survive on JobSeeker," she said.

"This will mean people going without meals, without medication, without the funds to pay for heating or cooling.

"We will not stop campaigning until we have an increase that is over the poverty line."

Money and Life
(Financial Planning Association of Australia)

Are you guilty of changing your spending habits when you're in a relationship? Do you have a financial plan, or are you relying on a partner to take care of you in retirement? Whatever your situation, there's never been a better time to step up and take charge of your finances.

Your relationship status can have a big impact on your finances. From spending and managing your money, to the types of investments and purchases you make, romantic partners are a big influence.

Some of life's biggest financial decisions are made together with a partner. Moving in together, buying a house and having children are all big triggers for differences in your spending habits to crop up.

Whatever your relationship status, the most important thing is to make sure your finances are sound for you. This is especially true for women, who face extra hurdles to financial freedom. On average, women retire with 47 per cent less super than men, so it pays to have a clear financial plan.

When spending habits don't align

Do you splash your cash on everything you desire, while your partner steadily saves for a rainy day? Or vice versa? When spending habits don't align, it can cause tension in a relationship. One study found that finances were a contributing factor in 42 per cent of divorces and separations.

Lying about your spending might feel tempting when you and your partner have different attitudes to money. But it's likely to lead to a loss of trust, and eventually relationship breakdown. Financial infidelity is on the rise however, with one-in-three adults admitting to hiding purchases, bank accounts, bills or cash from their partner.

Read more: Are you cheating on your partner with money?

How to get on the same page

The best way to get in front of these issues is to talk about your finances early on. Having open and honest conversations about your attitudes to money, your financial goals and what you expect from each other will help build a strong foundation for your relationship and your finances.

It's quite likely that you won't be in the same financial situation as your partner, so talk through things like your:

• Income
• Expenses
• Assets and investments
• Any debts or loan repayments you may have
• Your individual and shared financial goals and how you'll reach them.

Being honest from the outset also means not overspending to impress a potential partner. Splitting bills 50/50 can be a good way to keep the relationship equal and ensure both parties feel empowered. Just keep in mind that one partner may have less disposable income than the other, or more expenses to cover. Tailor your spending so that you both feel comfortable and can meet your other financial obligations.

Five important issues to consider before tying the knot

Dealing with debt

It's likely that you'll need to borrow money at some stage of life. In fact, nearly two-thirds of working Australians have some form of consumer debt outside of a home loan, according to research by ING.

If you're in a relationship, be careful about taking out credit cards or loans in both your names. Understand that if you do, you're both responsible for repaying the debt. In many cases, if the lender can't recover the loan from one party, they're entitled to recover it from the other. Any default on your payments will affect both your credit scores.

If your partner has a large debt, or is unable to access credit for any reason, don't offer to obtain credit on their behalf. Never personally guarantee someone else's debt, or take on any loans or credit cards to help clear their debt.

There may be other ways you can support your partner while they're repaying the debt, such as contributing more to household bills and expenses for a time. Encourage them to repay the debt themselves and keep them accountable. You want to see clear progress towards paying off the debt, as it shows their money management skills and that they take the issue as seriously as you do.

Read more: Coming clean about money

Do you need a Prenup or a Pronup?

You've probably heard of a prenuptial agreement, but have you heard of a pronup?

A prenup is a legally binding agreement about what will happen to assets you bring to a relationship if things don't work out between you.

A Pronup, on the other hand, has a completely different purpose. It's focused on planning for a future together, based on shared goals and how you'll work on them from a financial perspective. It's a great way to ensure you're working towards the same financial goals as your partner.

Related: Pronup or prenup: What's the difference?

Could you go it alone?

Whether you're in a relationship or not, it's important to understand and plan for your own financial future. Questions to ask yourself include:

• Do I have enough emergency savings to cover living expenses for a few months?
• How will I afford my/our ongoing living expenses?
• Will I have enough superannuation to support myself / my family in retirement?
• Do I have the right insurance/s in place?
• What is my investment strategy?
• Is my will up to date?

If you're unsure about any aspect of your finances, it's worth getting professional financial advice. A financial planning professional can help you understand your position and what you need to do to reach your financial goals.

Related: Could you go it alone? Making sure a man is not your financial plan

Money and Life
(Financial Planning Association of Australia)

Divorce is the leading cause of financial hardship for women (1). So it's important to take control of your money and plan for a time when you may become financially independent.

Spending priorities

According to a 2014 survey of over 2,000 women conducted by RMIT, 59% have experienced financial hardship as a result of divorce (2) and 80% chose providing for their family as a top financial priority. Only 50% considered a comfortable retirement an important financial goal (3). So, these issues are compounding the deeper, systemic issue of a gap in women's earnings and retirement savings that's cumulatively forcing some women into severe poverty in their senior years.

2016 Financial Planning Week Ambassador Jane Caro recently stated that women over 55 are the fastest growing demographic among homeless people in Australia (4). This is a really alarming indicator of the financial hardship older women are facing. It's also a signal for women of any age to take charge of their financial wellbeing, so they can be ready for whatever the future may hold.

The super gap how much is it?

We know women are still earning less across the board than men. And they're also most likely to be the ones taking time out from their career to care for children and other family members. These are two of the reasons why women can expect to retire with around half the super balance compared with men. Figures from the Association of Superannuation Funds of Australia (AFSA) show the average super balance for women at retirement is $138,150 and $292,500 for men. (5)

When you consider AFSA expects a single person in retirement to live on a budget of $24,108 a year (6) and that's just for a "modest" lifestyle a $138,150 nest egg isn't even going to last a decade. And that budget doesn't include rent or mortgage repayments. So if you don't own your home outright, it's going to be even harder to make ends meet in retirement.

The fallout from divorce

Losing out on owning a home can be one of the many financial consequences of a divorce. After you and your ex have split your assets, you may not have enough left over to buy property in the suburb you call home. Or you may scrape enough for a deposit, but you're starting all over again with a 25 or 30-year mortgage to repay.

This is just one of the financial setbacks women can expect to experience when their marriage breaks up. In their recent Divorce: For Richer, For Poorer report, AMP and the National Centre for Social and Economic Modelling (NATSEM) found the average divorced women has assets valued at 90% less than her married counterpart and can expect to be earning 10% less as well. (7)

Taking control

If you're currently single, or think of your relationship as rock solid, it's still really important to plan for your financial future as an independent woman. Happily married, or single, women can face financial hardship because of illness or bereavement too. And there's plenty of help available to get you up to speed on important money matters including debt, insurance, investment and superannuation.

In May 2015, ASIC launched a new Women's Money Toolkit to guide women through important financial decisions and support them towards better outcomes for their financial wellbeing. It deals with all kinds of topics from having kids to managing finances in a relationship and you can tailor the content to suit your life stage and circumstances.

If you're a woman living in a regional area of Australia you may have already come across the Regional Women's Financial Literacy Project.

Seeking financial advice from someone who really understands how to support you to make the most of your money, even when you're not earning much, can make an important difference to your financial stability and wellbeing.

Whether you're getting married or divorced, starting a family or retiring, a CERTIFIED FINANCIAL PLANNER® professional can offer valuable advice on preparing for a secure financial future. Find a local CFP professional today using Match My Planner.

For more tips and tricks on how to manage your money, avoid mistakes that can derail your financial future, and secure your financial freedom, download our free eBook.

Sources

1RMIT Survey Women and Money across the generations, 2014, page 23 http://www.financialliteracy.gov.au/media/558801/women-and-money-across-the-generations.pdf

2 RMIT Survey Women and Money across the generations, 2014, page 23 http://www.financialliteracy.gov.au/media/558801/women-and-money-across-the-generations.pdf

3 RMIT Survey Women and Money across the generations, 2014, page 16 http://www.financialliteracy.gov.au/media/558801/women-and-money-across-the-generations.pdf

4Sydney Morning Herald, "Getting sound financial advice is crucial for us all, but especially for women" Jane Caro, 22 August 2016, http://www.smh.com.au/lifestyle/news-and-views/opinion/getting-sound-financial-advice-is-crucial-for-us-all-but-especially-for-women-20160821-gqxwug.html

5ASFA Research and Resource Centre, Superannuation Account Balances by Age and Gender, December 2015, page 3, https://www.superannuation.asn.au/ArticleDocuments/359/ASFA_Super-account-balances_Dec2015.pdf.aspx

6AFSA Retirement Standard, December Quarter 2016 https://www.superannuation.asn.au/resources/retirement-standard

7Sydney Morning Herald, Women with children biggest financial losers of divorce: report, Daisy Dumas, 13 December 2016, http://www.smh.com.au/lifestyle/news-and-views/news-features/women-with-children-biggest-financial-losers-of-divorce-report-20161212-gt92op.html

Colin Brinsden, AAP Economics and Business Correspondent
(Australian Associated Press)

The Reserve Bank still does not expect to lift interest rates for a number of years, despite upgrading its economic forecasts.

Central bank governor Philip Lowe says the economic recovery has been stronger than earlier expected, which has seen a welcome decline in the unemployment rate to 6.6 per cent.

"These outcomes have been underpinned by Australia's success on the health front and the very significant fiscal and monetary support," Dr Lowe said in his post-meeting statement.

But he said both wage and inflation pressures remain subdued.

As economists expected, the central bank left its cash rate at a record low 0.1 per cent and other monetary policy measures unchanged at its first board meeting of the year on Tuesday.

But Dr Lowe reiterated the board will not increase the cash rate until actual inflation is sustainably within the two to three per cent target range.

"For this to occur, wages growth will have to be materially higher than it is currently," Dr Lowe said.

"This will require significant gains in employment and a return to a tight labour market."

The board does not expect these conditions to be met until 2024 at the earliest, a year later than it had previously envisaged.

However, the central bank did surprise financial markets by announcing it will extend its bond-buying program beyond mid-April, and when it will start purchasing a further $100 billion in federal and state government bonds.

This quantitative easing (QE) program aims to keep long-term market interest rates, and in turn borrowing rates, low.

Dr Lowe said the central scenario is for economic growth to return to its pre-pandemic level by the middle of the year and grow by 3.5 per cent over both 2021 and 2022.

"Although the upgrade to the outlook seems somewhat at odds with the extension of the QE program, to achieve the RBA's inflation target the economy needs economic activity to be significantly higher than its pre-COVID peak," BIS Oxford Economic chief economist Sarah Hunter said.

New figures show employment grew further in the early stages of 2021, albeit still lagging when compared to a year ago.

The Australian Bureau of Statistics said payroll jobs grew by 1.3 per cent nationally over the fortnight to January 16, with increases reported in all states and territories.

The weekly ANZ-Roy Morgan consumer confidence index a pointer to future household spending also rose for a second consecutive week and is close to its long-term average for the first time since late 2019.

These latest positive results add to a spread of economic figures in recent weeks suggesting the economic recovery is in full swing.

"It is important to recognise the vast extent to which Australia has come back and that comeback has been enormous across our economy," Finance Minister Simon Birmingham told Sky News.

But the minister warned there will be lasting changes as a result of the pandemic and the government won't be offering a helping hand to businesses that are no longer viable.

"Some businesses won't find their business models from before are as viable in the future as they might wish them to be they will have to change and adapt," Senator Birmingham said.

"So we don't want to prop up activities where people may need to adjust their business model. They may need to adjust their circumstances for the future."

Money and Life
(Financial Planning Association of Australia)

It's the shortest month of the year so what better time to make a change and save some money? We've got three tips for each of the next four weeks to help those dollars pile up in Frugal February.

Week 1 the same lifestyle for less

In week one, we're easing you into the swing of saving with some good financial habits to get you into a new frame of mind without giving anything up yet

1. Cash only - starting now, stash your credit card in a safe place and use only cash for all your purchases. Tap and go is quick and easy, but it also tends to make us more blasé about our budget. When you find yourself hitting the ATM twice in one weekend for shopping and entertainment, you're more likely to watch what you're spending.

2. $50 fun - think of at least four activities you can do on your own or with friends and family, that cost $50 or less. It could be a low-cost gardening project, heading off on a hike or paying for a group lesson to learn something new. Just remember to include snacks or food in your plans and costing a café pit stop or takeaway could quickly blow your $50 budget.

3. Swap and save - beauty, books, clothes, appliances, if it's something you spend on, try swapping instead. Clothes are an obvious choice, but if you and your friends have a weakness for cookbooks or games, try organising a big swap party to grow your collection.

Week 2 be food wise (and fuel your bank balance too)

Take some time this week to put the spotlight on how you eat and save money along the way.

1. Lose the lattes (long blacks, flat whites and macchiatos too) - however you drink it, at four dollars-a-cup, takeaway coffee is a daily indulgence that can quickly add up. Pre-pandemic, Aussies were well known for spending an average $1144 a year on takeaway coffee! That dropped to $728 ($14 a week) in 2020. So if you changed your habits last year, think about whether it's something you can live without.

2. Ditch the takeaway and cook in - bulk ready meals and takeaway can feel like a time saver, but the convenience is costing us $1976 a year, according to Suncorp's annual Cost of Food report. Instead, try cooking bulk meals using a few key staples like flour, pasta, rice, legumes and potatoes and store the leftovers in the freezer. You'll quickly see the savings roll in.

3. Purge the pantry (and the fridge) - a lot of households keep enough stuff in the cupboards and fridge to last for weeks, perhaps months. How much could you save simply by living off what you already have instead of shopping for groceries this week?

Week 3 entertainment that's lighter on your pocket

1. Dine at home - like many COVID-19 led changes, our spending on dining out halved last year, from $54 down to $27. You could save yourself $1404 a year just by sticking to this new, lower spending limit. So why not make a meal of your home cooking for family and friends?

2. High and dry - with the pubs shut for long periods, Aussies splashed out an extra $2 billion on household alcohol last year, according to Finder analysis of ABS data. That's really no surprise, given 20 per cent of us increased our drinking over the lockdown months. No wonder giving up alcohol is a popular challenge taken up for Febfast! Whether you pocket your savings, or choose to donate it, you're going to feel better after a month without drinking.

3. Give Uber the elbow - whether you're staying sober, staying home or both, there's really no need for you to be using Ubers this month. Delete the app from your phone so you'll be less tempted to use it when you're in a rush to get home!

Week 4 big expenses, even bigger savings

1. Pay less for your mobile/electricity/insurance - if you've been with the same provider for a while, for any of these services, there's a good chance that shopping around for a new deal can save you a significant amount across the year.

Read more: Top negotiating tips to cut your bills now

2. Holiday for free - With international travel off the cards, house sitting or swapping locally are good ways to enjoy a getaway without shelling out for a hotel room. If you don't have a home that's Air BnB ready or appealing to swappers, get on to websites like https://www.happyhousesitters.com.au for housesitting opportunities in Australia. 

3. Ditch your debt - whether it's taking a year or two off the mortgage or saying goodbye to credit card balances, make this your month to find smarter ways of living with your liabilities. The amount you'll save on the overall cost of borrowing can be substantial when you take steps to pay off your loans faster.

Looking for more ways to save? Get tips to prevent overspending or set yourself up with a flexi-budget for the new year.