The Era of 1.25% Interest Rates: How People in Their 40s and 50s Should Think About Protecting Their Money Now | How to Manage New NISA and Home Loans Effectively

Hello, I’m Kurumi🌷

Recently, we’ve been seeing more news about interest rates rising and stock prices climbing.

While watching such news, you might wonder,

“What will happen to my home loan repayments from now on?”
“Will my retirement savings be okay as they are?”
“Should I start a new NISA?”

I imagine some of you might be feeling that way.

For those in their 40s and 50s, this is a time when opportunities to think about money increase, such as children’s education expenses, home loans, caring for parents, and your own retirement.

I also feel a little anxious when I think about my future finances.

However, there is no need to worry more than necessary.

The important thing is not to be swayed by the news, but to understand your current household finances and start preparing in a way that suits you, little by little.

In this article, while checking recent trends regarding interest rates, prices, and investments, let’s look together at how people in their 40s and 50s should think about protecting their money starting now.

1. How will our lives change when interest rates rise?

In September 2026, the Bank of Japan raised its policy interest rate to 1.25%.

As interest rates rise, there is a possibility that our lives will be affected little by little.

For example, if deposit interest rates rise, the interest earned on money in the bank may increase.

On the other hand, for those using variable-rate home loans, there is a possibility that repayment amounts will increase in the future.

However, the impact on home loans varies depending on the financial institution and the terms of the contract. Just because interest rates have risen does not mean that everyone’s repayment amount will increase immediately.

First, let’s check your own home loan.

• What is your current applicable interest rate?

• When is your next interest rate review?

• If interest rates rise, how will your repayment amount change?

Just knowing these three things will make it easier to think about your future household finances.

2. Even if your salary increases, it doesn’t necessarily mean your household budget will have more breathing room

Recently, there has been more news regarding wage increases.

In the 2026 spring wage negotiations, the final tally by Rengo showed an average wage increase rate of 5.01%.

While this is bright news, this figure is an average of the negotiation results. It does not mean that everyone’s salary increased by the same percentage.

Furthermore, even if your salary increases, if expenses for groceries, daily necessities, and utilities also rise, you may find that your household budget doesn’t have as much breathing room as you expected.

“My salary should have increased compared to before, so why aren’t my savings growing…?”

If you feel that way, please don’t blame yourself too much.

First, let’s take a slow look at your monthly cash flow.

The important thing is not to force yourself to save, but to find a way of spending money that suits your current lifestyle.

3. You might be interested in the New NISA, but there is no need to rush into starting it

“If I’m preparing for retirement, should I start a New NISA?”

Many people may have that question.

The New NISA is a system where profits earned from investments are tax-exempt within certain conditions and tax-exempt investment limits.

It is one option to consider when thinking about building assets over a long period of time.

However, there is something to keep in mind here.

The New NISA is not a system where the money you deposit is guaranteed to grow.

Investment trusts and stocks can go up in value, but they can also go down. There is a possibility that the money you invested could fall below the principal.

That is precisely why there is something you should think about before you start.

• Have you secured enough money for living expenses and unexpected costs?

• Do you have money you will need soon, such as for a home loan or education expenses?

• Even if the value drops temporarily, do you think you can stay calm and continue?

After confirming these points, let’s think about the amount and method that suit you.

There is no need to rush just because people around you are starting.

It is perfectly fine to think about it at your own pace.

4. Things to think about calmly, especially when stock prices are rising

The closing price of the Nikkei Stock Average on October 13, 2026, was 67,777.52 yen.

Seeing the rise in stock prices, some of you may be wondering, “Should I start investing now?”

However, just because stock prices are rising does not mean they will continue to rise forever.

Conversely, just because stock prices have fallen does not necessarily mean you need to sell everything immediately.

The important thing is not to judge based solely on short-term price movements, but to think about why you are investing.

For example, long-term investment to prepare for retirement living expenses and money you plan to use within a few years require different management methods.

You want to choose a method that is sustainable while considering when you plan to use the money and how much of a price drop you can accept.

5. Bank stocks or high-dividend stocks do not necessarily mean peace of mind

In a phase where interest rates are rising, there may be a positive impact on bank earnings.

Therefore, some people might be interested in bank stocks.

Also, high-dividend stocks that allow you to receive dividends are known as an option for asset building.

However, neither of these guarantees a profit.

Bank stock prices can also fall, and depending on a company’s performance, there is a possibility that dividends could be reduced or stopped entirely.

Do not assume that “high dividends mean safety”; you should also check the company’s performance, financial situation, and the risk of stock price fluctuations.

Try not to limit your investments to just one area, and make sure to consider options within a range you understand.

If it feels difficult, it is perfectly fine not to force yourself to increase your investment options.

6. Consider early repayment of your home loan by looking at your overall household finances

Some people may worry about their home loan repayments and wonder, “Should I pay it off as quickly as possible?”

Early repayment has the benefit of potentially reducing the burden of interest.

However, you need to be careful about the fact that your available cash will decrease significantly.

There are surprisingly many situations where you might need a lump sum of money, such as sudden illness, appliance breakdowns, or your children’s higher education.

When considering early repayment, check the following points:

• Can you keep enough money to cover sudden expenses, such as several months’ worth of living costs?

• Are there any education or repair costs that will be needed in the near future?

• How much interest can you actually save through early repayment?

• Will there be any impact on things like the home loan tax deduction?

The appropriate decision will vary depending on interest rates, contract terms, and your household’s financial situation.

Rather than feeling rushed to “pay it off quickly,” it is important to think about it while looking at your overall household finances.

7. Five financial reviews you can start today

We have discussed many things so far, but there is no need to change everything at once.

To start, choosing just one thing you can do is enough.

1. Check your monthly expenses

Take a look at your food, communication, and insurance costs. Rather than forced frugality, it is recommended to start by reviewing services you are not using.

2. Check your home loan contract

Checking interest rates, review periods, and rules for changing repayment amounts will make it easier to plan for the future.

③ Secure funds for living expenses

Before considering investments, make sure to set aside money to handle unexpected expenses. The necessary amount varies depending on your family structure and work situation.

④ Learn about the New NISA

Start by learning about how the system works and the risks associated with investment trusts. Even if you don’t start investing right away, learning will increase your future options.

⑤ Try talking to your family about money

It is also recommended to have small, gradual discussions about home loans, education expenses, and life in retirement. You don’t have to carry the burden alone; thinking about it together can sometimes make you feel more at ease.

Summary | Future money starts with small reviews today

Watching changes in interest rates, prices, and stock prices can sometimes make you feel anxious about your future finances.

However, just because you are anxious, you don’t need to make big decisions immediately.

First, understand the current state of your household budget, check your home loan contract, and secure the money necessary for your daily life.

Once you have done that, it will be fine to think about methods that suit you for building assets, such as the New NISA.

The important thing is not to compare yourself with others, but to make choices that are reasonable for you and your family.

Why not start with a small step you can take today to protect your future money?🌷

Thank you very much for reading until the end.

*This article is intended for general information purposes only and does not recommend investment in any specific financial product. Investments carry the risk of loss of principal. Regarding home loans and tax treatment, please check your contract details and individual circumstances.