Welcome to 2026. I hope 2025 was everything you planned it to be. I think 2026 will be an interesting year ahead.
For all of us, we will be managing the perils of markets with potential rising interest rates. This will affect markets and something many of us have, the cost of home loans.
I would not be panicking around the interest rate topic at this stage. I am of the view the Reserve Bank will stop its interest rate reduction cycle and watch some key economic indicators before it rushes out and starts any rapid increases. When you have debt of any description, you must always manage it with care, as these cycles will come and go.
When it comes to inflation, the Reserve Bank’s comfort zone will be a problem for years to come due to two key factors. Our governments are spending like there is no tomorrow, and that will continue to stimulate the economy. The second factor, which is connected to the first issue, is our rising cost of labour. This is of significant concern when you correlate this increase to a decrease in the level of output. When we look at inflation drivers, this is a big one and needs to be addressed somehow.
The sad thing is that many Australian businesses are addressing the cost of labour issue, with outsourcing many roles and functions overseas to cheaper labour markets. This outsourcing seems to be continuing at an increasing rate. A more fiscally responsible approach by government is needed here, not just on the inflation front, but also the level of debt which is alarmingly high. In the short to medium term, our Reserve Bank govern may need to accept inflation at a slightly higher level.
On the world scene, I don’t believe you could see a more politically unstable environment without a world war. Our world is now increasingly controlled by dictators. I won’t comment any further on this because my email would go on forever, as I want this message to be somewhat motivating.
These economic and government factors will always play out. What can you control in 2026? Your world, your life, your business. I always emphasise planning and these plans should be rolling and engrained behaviour. I think the big thing which has always been important is managing the PRIORITY.
In a world that gets bigger and faster and with ever evolving and increasing technology (that is supposable having us do less and even make us redundant), the priority can get lost.
What is your priority? Once you have that, let me tell you that is the easy bit. Making sure you don’t lose your priority in busyness, tiredness, excuses and blame. That’s the hard bit.
At times, you will feel the world is going mad. My advice is, don’t go with it!
Wishing you and your family a happy, safe, and prosperous 2026.
Mark Templeton
Managing Director, TAG Financial Services
Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2026. Please do not reproduce without the expressed written consent of the author.