As we inch closer to the 2025 federal election, set to occur on or before May 17, there’s more at stake than just who will lead the country. Elections often bring policy shifts that can directly impact your financial future—changes to tax structures, superannuation rules, or housing incentives. While we can’t predict the outcome, we can certainly prepare for potential changes.
Elections tend to shake things up financially, and 2025 is no exception. Governments frequently introduce or revise policies that influence key areas like:
- Taxation – Adjustments to capital gains tax, negative gearing, or income tax brackets could significantly impact your investment strategy and take-home pay.
- Superannuation – Contribution caps, concessional tax rates, and access rules might be on the table, affecting how you plan for retirement.
- Housing market – Policies around property investment, first-home buyer incentives, and rental affordability may shift, impacting both homeowners and investors.
- Healthcare & social services – Funding changes could affect medical expenses, aged care, and social benefits.
Will we pay more or less tax?
One of the most talked-about areas of financial policy during elections is taxation. Political parties often propose changes to income tax brackets, capital gains tax, and negative gearing laws.
Negative gearing is always a hot topic for property investors. Limiting deductions on investment property losses could reshape the real estate landscape if policies tighten. Investors may need to consider positively geared properties or explore alternative asset classes, such as shares or managed funds, to maintain steady returns.
Additionally, potential adjustments to capital gains tax could affect how and when you sell assets. If changes are on the horizon, planning could help minimise tax burdens and maximise profits.
Superannuation is another area that tends to attract political attention. Proposed reforms might include:
- Adjustments to contribution caps could impact how much you can put into your super each year.
- Changes to the concessional tax rate affect how much tax you pay on your super contributions.
- New rules around when and how you can access your super, especially for early retirement or specific financial hardships.
Being proactive is key. If changes are proposed, knowing how to optimise your super contributions before new laws take effect could make a big difference to your long-term retirement savings.
Will we see an interest rate cut?
Over the past few years, we’ve seen aggressive interest rate hikes as the Reserve Bank of Australia (RBA) battled inflation. However, with inflationary pressures easing, speculation is growing that interest rates could decline in late 2025.
What does this mean for you?
Lower rates could reinvigorate the property market, making real estate a more attractive investment again. Borrowing costs may become more manageable, offering opportunities for refinancing or expanding investment portfolios. Businesses might see better conditions for growth, which could positively impact the stock market.
Keeping a close eye on economic indicators can help you make timely financial decisions in response to shifting interest rates.
Election years often bring heightened market volatility. Investors tend to react to uncertainty, causing fluctuations in stock prices, property values, and overall market confidence. While it’s natural to feel uneasy during these times, a well-diversified portfolio can help mitigate risks.
If you’re worried about market movements, now is a great time to review your asset allocation. Are you too exposed to high-risk investments? Do you have enough diversity across asset classes to weather potential economic changes? Speaking with a financial advisor can help ensure your investment strategy aligns with your risk tolerance and long-term goals.
Engage with the political process
Your vote matters—not just politically, but financially too. Policies introduced by different parties can directly impact your wealth-building strategies. As your financial advisor, we urge you to research party platforms on taxation, superannuation, housing, and economic growth. Attend local candidate forums to understand their views on financial policies and stay informed through reputable sources rather than relying on election-time rhetoric.
While elections can create financial uncertainty, they also present opportunities to fine-tune your financial strategy. By staying informed and proactive, you can position yourself to take advantage of policy changes rather than be caught off guard by them.
Financial planning isn’t about reacting to every political shift—it’s about having a solid, long-term strategy that can weather economic changes. If you’re unsure how upcoming policy changes might affect your financial future, now is the perfect time to consult with us.
We can help
Step Up Financial Group is a team of qualified financial specialists. We help hundreds of Australians create financial stability and resilience every year while building toward a confident retirement. Contact us today for experienced, compassionate, and professional financial planning advice.