Cutting down on ‘forgettable comforts’, starting up a side hustle, and switching health insurers are just some of the easy ways experts say Australians can save money amid the cost-of-living crunch.
Borrowers were on Tuesday hit with the ninth cash rate rise in a row, putting more pressure on squeezed mortgage holders as the Reserve Bank tries to stem inflation.
The cash rate was hiked 25 basis points to 3.35 per cent as the RBA warned further increases will be needed in the months ahead to bring inflation from 7.8 per cent back to within 2 to 3 per cent.
RateCity said the rises add up to an extra $908 a month in repayments for the average borrower with a $500,000 loan since the central bank’s hikes began in May.
For a $750,000 loan, the latest rate increase will mean an extra $114 a month or $1362 since the start of the cycles of rises.
But money experts, along with savvy Australians who have increased their income despite budget stress, have revealed their top tips for saving money.
Reserve Bank Governor Philip Lowe (pictured) leaves his upmarket Sydney house on Tuesday on his way to announce the ninth consecutive interest rate hike for Australians
Haggling is a thing in Australia:
CHOICE savings expert Liam Kennedy told Daily Mail Australia a lot of retailers have the discretion to mark down the cost of items.
‘It’s not something many of us do but especially when buying big tickets items – like matrasses for example – shops are able to negotiate,’ he said.
‘Paying in cash also helps. We got the price down by 50 per cent in some circumstances.’
Cut back on ‘easy’ comforts you won’t miss:
HPH Solutions financial planner Matt Hearn suggested walking to pick up takeaway from nearby rather than forking out the extra cash for delivery.
Even better, meal prepping rather than buying takeaway is a huge money saver, as is turning off electronics or air-conditioners when they’re not essential.
‘Rather than having multiple streaming services at once, subscribe and binge one service every three months,’ he said.
‘Consider replacing more expensive fitness memberships with cheaper alternatives or start doing free outdoor exercise.’
While it may require a bit more effort, little changes such as this can help Aussies feel better about themselves and their back pocket, he said.
Home borrowers are paying back hundreds of dollars more a month on their mortgages than a year ago (stock image)
Take on a side hustle:
Matthew Harsas, 31, from Kingsgrove in Sydney, works in pest control but recently joined Airtasker as a side gig.
The father-of-one’s main asks include carrying out handyman work, assembling furniture and pest control and he has achieved Gold status which sees him rake in about $2500-$3000 each month on top of his other job.
‘I’ve got a mortgage and family, and Airtasker allows me to make extra income, which helps cover mortgage repayments with the rising interest rates, bills and general day-to-day living,’ he said.
‘It also gives me the flexibility to work when and where I want, and I get a lot of repeat clients and referrals.’
One plus to rising costs is that wages, at least in the gig economy, have gone up.
Airtasker’s Wage Price Index (AWPI) shows wage growth in Australia’s labour and service economy based on data generated by completed tasks in the app.
When comparing wages between the first and last quarters of 2021 there was a 22 per cent increase in wages earned on the platform.
Wages not only remained at this level in 2022 but rose by a further 9 per cent over the year.
Rent your clothes (seriously):
Student Regina So, 21, works at David Jones and is in her third year of a degree studying Economics and Marketing.
With a hike in rent, bills, groceries due to inflation, she’s turned to her wardrobe to help cover spiralling costs and university fees.
Regina turned to peer-to-peer luxury dress rental platform The Volte last and makes up to $7000 a month renting out her designer dresses, and has made more than $30k in the last year!
‘Everything is getting so expensive,’ she says.
‘The last two months have really exploded with people hiring dresses for Christmas, New Year, weddings, events and holidays.
‘The money goes towards my university fees, transport, food, bills and covering the rising cost of living, and I invest back into the business. I love fashion and sales, so combined the two and it’s really working out.
‘I’m a little girl with the big dream, and would love to be able to do this full time once I leave university.’
Regina So (pictured) rents her designer dresses out on The Volte app and earns thousands a month
Don’t be on ‘autopilot’ at the supermarket:
‘We tend to fall into habits and get the same items when we browse the supermarket aisles,’ Mr Kennedy said.
‘When grocery shopping pay attention to prices and keep an eye out for sales or special buys of your favourite products or something you wanting to purchase. Maybe even buy in bulk when it’s on sale.’
‘Also look at the unit price under the main price, this breaks things down and you can see where you get best value for money.’
‘And buy refills of cleaning products, this can save you up to 30 per cent on each item.’
Parking spaces are in demand:
Salesman, Zack Georgoulas, 18, from Brookvale in Sydney rents out on one side of his double garage on Parkhound for $300 a month.
‘I don’t have a car at the moment and my rent has gone up $350 since I first moved in, so I’m trying to cut back on expenses and save where I can,’ he said.
‘I’ve used Parkhound to park in the city before and also rented the spot in my last place on it.’
‘I listed it last month and got a booking within a few hours. I’ve now got someone in there who has booked for the year and he often works in the city, so it’s convenient and affordable for him to drive to the garage and then take the bus in.’
‘It makes sense to rent out your underutilised assets.’
Think outside the (storage) box:
Due to rent rises and the cost of groceries going up, Andrew Woods, 36, from Collaroy in Sydney’s Northern Beaches is leasing out his garage on Spacer.
The app marries up those with spare space to people needing it and not just for cars.
He rents the empty part of his garage for $350 a month to Mia Martens, who uses it for storage.
‘Things are really tough at the moment and every dollar counts. My friend told me about Spacer and as I have a double garage with just one car, I figured I’d list it and it was booked within a week, it’s the easiest side hustle ever,’ Mr Woods said.
‘I have a lockbox so Mia can come and go as she pleases. I’m even thinking of parking on the street and renting out the other side.’
Mia, who rents the garage, said: ‘I’ve recently moved and couldn’t take everything with me. Renting the garage means I don’t have to pay huge storage fees. I use it to work out and to store my sofa and larger items. It’s next to the beach, so I keep my surfboards there too.’
Andrew Woods rents his extra garage space to Mia Martens for $350 a month through the Spacer app so she can store her surfboards and workout gear closer to the beach
Check product reviews:
To avoid buying a dud and wasting your money, Mr Kennedy advises checking product reviews like those found on Amazon.
‘At CHOICE we test a lot of households products and everyday things and we publish the reviews on our site.’
‘There are some dodgy products out there that aren’t worth their price tag and by doing research you can avoid those pitfalls.’
Be wary of buy now pay later apps:
Mr Kennedy said these can be traps especially for young people who are able to buy things without waiting.
He said similar to credit cards, the interest rates can be incredibly high if you aren’t quick to pay back the money and longer term it can affect your credit score.
Shop around for better offers on your monthly bills:
CHOICE recommends looking closely for a better deal on your health insurance.
‘Our research shows you can save up to $935 a year on hospital cover by switching to a similar policy with a different provider.’
It’s also a good idea to consider switching or downgrading your health insurance if you’re paying for cover you don’t use.’
This also applies to phone, broadband and electricity bills. Shop around, another provider probably has a cheaper alternative.