At the start of the year we hoped 2021 would be better, instead it’s been, well, interesting. There have certainly been some ups and downs, especially in the world of finance, so who were the winners and losers and what had us scratching our heads?
Over the course of the pandemic, house prices, on average, increased a whopping 20-25%, contrary to most predictions at the start of the pandemic which prophesied dramatic price drops. Just goes to show how market movements are hard to predict even for the experts. What will happen next year? This year proves that no one really knows.
Labelled by some as “the future of millennial finance”, BNPL schemes have exploded during the pandemic. There have never been more ways to spend your money or ways to pay for purchases interest-free. There are now more than a dozen BNPL companies operating in Australia. Even the banks are jumping on the bandwagon and according to the Reserve Bank, in the 2019/2020 financial year, BNPL providers processed more than $9 billion in payments.
If used wisely it can be an easy way to spread out payments on a purchase. Used poorly, BNPL can result in missed payment fees, the inability to meet other expenses and a black mark on your credit file. So be careful not to let the euphoria of instant gratification turn into an emotional crash of debt regret.
While the abundance of new players in the market has been welcomed by users (especially the schemes that don’t charge fees), the story for investors has not been so rosy. Shares in BNPL companies have plummeted by an average of 80% recently, with some dropping up to 96% in value. Ouch!
For anyone taking a punt on crypto, it really has been a rollercoaster ride. The value of cryptocurrencies can move more in a day than some shares move in a decade, up and down. For example in November alone, the price of Bitcoin was as low as $53,000 and as high as $68,000. So these bets are definitely not for the faint-hearted or risk-averse investors.
From serious milestones to the weird and wonderful, here are some interesting news stories from this year:
Sometimes you just need a laugh.
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