26 Clever Ways to Reduce Your Cost of Living

Are you feeling the pinch from rising inflation, fuel prices or interest rates? You’re not alone. According to the ABS, as of March 2022, inflation rose by 5.1% in the last twelve months and CHOICE’s recent Consumer Pulse Survey found that concern amidst Australians over the cost of living is at its highest in three years.

So how can we help reduce the cost of living to pr­otect ourselves in this period of uncertainty? Well, the team at MoneyQuest Australia have put their heads together to find 26 useful ways to reduce your cost of living and potentially save a whopping $5,866 a year! We’ve broken these tips down into 5 basic categories.

Transport

• Public transport passes
• Carpooling

Home and living

• Check your state government’s websites for subsidies and rebates
• Call your service providers and ask for a better deal
• Review your bank and superannuation fees
• Bulk Buying (for your pets too)
• Check Facebook Marketplace first
• Cancel your gym membership and workout from home

Food and drink

• Coffee!
• Do your grocery shopping once a week (and make a list)
• Meal prep instead of eating out
• Cook more vegetarian meals
• Split your bills fairly
• Take advantage of dinner deals and pick them up

Entertainment and holiday

• Share streaming services
• Free activities to keep you entertained
• Ditch the night out and host a night in
• Shop for quality, not quantity
• Coupons, discounts and deals
• YouTube Premium – Kill 2 birds with one stone
• The 24-hour rule
• Holiday with friends and save

Bonus tips

• Get a side hustle
• Get yourself a killer budget spreadsheet (FREE download)
• Leverage your market value
• Speak with your local MoneyQuest finance specialist

Reduce transport expenses

1. Public transport passes

Have you ever calculated how much you’re spending on transportation each month? If you take public transport, this tip could save you hundreds each year.

Make sure to check with your states’ public transport authority for any passes they might offer. For example, if you’re working full-time in metro Melbourne, spending $9.20 a day for the train on zone 1+2, you would be spending $184 a month or $2,208 a year on public transport.

Instead, if you were to buy a yearly Myki pass that costs $1,794 (with the 40-day discount), you would end up saving $234 a year. This doesn’t even take into account any weekend trips!

2. Carpooling

With extortionate petrol prices becoming an increasing issue here in Australia, it’s never been more important to consider carpooling. Whether that be to work, to school, to an event, dinner or social gathering or even a group holiday, you’ll wonder why you didn’t consider it sooner.

Total estimated yearly savings: $234 + any additional savings

Reduce home and living expenses

1. Check your state government’s websites for subsidies and rebates

Depending on your state and circumstances, you may be eligible for government subsidies or rebates to help ease cost of living pressure. For example, the Victorian government’s $250 Power Saving Bonus Program is a one-off $250 payment to households. The bonus is available to all Victorian households who visit the Victorian Energy Compare website.

2. Call your service providers and ask for a better deal

Speaking of comparing energy providers, another way you could reduce your cost of living is to call your energy provider and ask for a better deal. This practice also applies to your phone company, car insurance and more.

Many Australians suffer from the dreaded Loyalty Tax, so regularly contacting your service providers ensures you’re consistently getting the best deal that you can.

3. Review your bank and superannuation fees

Many banks have fees and some even have hidden fees! (So rude). When was the last time you checked your bank fees? Perhaps now is the time to review them and see what other banks are offering. For example, some online banks offer zero fees and even zero international transaction fees. This could save you tens of dollars each year. Doesn’t sound like much, but everything ads up!

You could even go a step further and contact your superannuation fund to see if you’re being charged for any fees or insurance that you may not need. For example, some super funds offer life insurance by default but if you’re still young and healthy, you may not even need it.

4. Bulk Buying (for your pets too)

Think ahead and bulk buy! If you know there’s certain items you use and consume on a regular basis, this is a no-brainer! Things like paper towel, olive oil, glad wrap, laundry detergent, cleaning products, dishwashing tablets etc, are all higher priced grocery items that have a long shelf-life and if you buy them in bulk, you can significantly reduce your yearly grocery expenses.

However, a note of caution; always be selective when bulk buying and only choose products you know are going to be consumed within the expiry.

Things like rice and oats, cereal, muesli bars, vegemite, peanut butter, tuna, flour and sugar may all seem like great things to keep in your pantry but before you start bulk buying, you should always consider what your overall household frequency and consumption actually is before you start piling them into your shopping trolley.

Okay, so you’re probably thinking this is going to cost me more initially at the check-out! Yes, this is true but the amount you will save in the long-term is 100% worth it!

Let’s look at pet food for example; it’s a decently expensive item that has a long life and if you own a pet, you know it’ll get consumed because your pet needs to eat. A 4kg bag of dog food at a local pet shop is $59.98 and a 15kg bag of the same food is $145.80. If your dog goes through a 4kg bag every fortnight, you’ll need to buy 26 bags per year and your spending would be $1,559.48. If you were to buy a 15kg bag, you’d only need 7 bags per year and therefore you’d be spending $1,020.60 and saving $538.88 per year on dog food compared with buying the smaller bag.

Think how much you could save per year if you applied this to all your highly consumption groceries!

5. Check Facebook Marketplace first

This handy little trick can apply to just about anything you buy. Before going ahead with that new wall clock or dining table, go to Facebook Marketplace or Gumtree instead and search for the same or similar item. You never know what amazing savings you could come across!

For example, let’s say you’re looking to buy a clock online for $99, but instead you look for the same clock or something similar on Facebook marketplace for cheaper and save a few dollars.

Now, do this for every reasonable purchase and the savings could easily stack up.

6. Cancel your gym membership and workout from home

You don’t need fancy equipment to get shredded!

For years large corporate gyms have been convincing us we need fancy equipment to work up a sweat and sculpt impressive muscles. It’s not true! One thing we learned from being in lockdown is that you can use all sorts of household items as weights and get a full body workout without having any equipment at all. If you’re looking to build up your piggy bank, it’s worth considering cancelling your potentially underutilised and overpriced gym membership.

According to Canstar, Aussies spend on average $95 per month of gym memberships. That’s a whopping $1,140 a year! This is how much you could save if you cancel your membership and workout from home.

If you’re desperate to lift, you could use household items like your 12kg laundry detergent (and other bulk buys) as a substitute dumbbell but body weight exercises are proven to be just as effective; we’re talking push-ups, pull-ups, sit-ups, planks, dips and other body weight exercises that you can do in the comfort of your own home and let’s not forget you can walk or run anywhere!

If you’re not sure how to do a full body workout without using any equipment, there’s plenty of free programs and step-by-step videos on YouTube and if you’re unsure what to do, just google it! You can still achieve a solid six-pack, potent pectorals, bulging biceps and other physical prowess without those pesky gym fees.

Total estimated yearly savings: $1,928 + any additional savings

Reduce food and drink expenses

1. Coffee!

Hear us out, the $1 coffee at 7/11 is actually pretty good. If you’re the kind of person who loves to grab a takeaway coffee on your way to work, this expense can really add up over time. For example, if you were to buy a coffee every weekday, this could cost around $1,250 a year. Substitute this with deliciously cheap 7/11 coffee and you’ll only be paying $250. That’s a savings of $1,000 a year!

2. Do your grocery shopping once a week (and make a list)

Grocery stores have figured out how to hack your brain and squeeze out as much money as possible from your shopping trip. If you often go shopping twice or three times a week, there’s a big chance you’re overspending and purchasing things you don’t really need.

So, here’s what you need to do. Choose one day a week to go grocery shopping. Most importantly, create a shopping list and stick to it! This keeps you accountable for any overspending. Even better, try to create a weekly or monthly budget for grocery trips to really nail any overspending on its head. We have a killer budget spreadsheet available to download later in this blog.

3. Meal prep instead eating out

Speaking of food, have you heard of a little thing called meal prepping? No? Well,  this is something you need to try. If you were to buy lunch at work every day or couple of days, this would seriously add up. For example, let’s say you buy a $12 meal every work day, this could cost around $3,000 a year. So, how can you reduce this expense? Well, this is where meal prep comes in.

Next time you’re about to cook dinner, try to cook a few more portions than you normally would. Do this every time and you’ll have enough extra meals to take to work. You could even cook a week’s worth of meals in one go and freeze them. This’ll save time for other things and save you money at the same time!

Let’s say one portion of a home-cooked meal can cost as low as $2 depending on what you make, you could save $2,500 a year.

4. Cook more vegetarian meals

If you’re already meal prepping and trying to think of ways to reduce this expense even further, consider cooking more vegetarian meals. Meat can become a costly item so reducing the amount of meat you eat every week can save you money.

For example, let’s say you spend approximately $336 on groceries per week. Consider how much money you’re spending on meat and see if you can substitute it with a meat-free option. If you eat meat in every meal, try cutting back to only eating meat every 2^nd or 3^rd meal.

Make sure to track how much you’re spending each week to calculate how much you’re saving. The result may surprise you!

5. Split your bills fairly

Do you ever find yourself in that awkward situation where you constantly pay for brunches, dinners and drinks on a day or night out with friends and family, all because many hospitality venues make it difficult for customers to split the bill?

Most people want to be fair to each other but sometimes it’s hard to find the right balance, especially when some eat or drink more than others. It can be easier to take turns paying but sometimes it’s hard to keep track of who paid last time and how much was spent. Often that can result in you over-paying for fear that you might look ‘tight’ in front of your loved ones.

If you’re constantly finding yourself in this predicament, you may want to look at downloading some free apps to help you, your friends and family split and keep track of payments. Apps like Splitwise and Beam can help you track your shared expenses so everyone can see who they owe and pay accordingly. Whether you’re sharing a holiday on the ski slopes, splitting rent with roommates, or paying someone back for dinner, these apps share information with all the parties involved and are designed to make life easier so you don’t always get stuck paying for other people.

6. Take advantage of dinner deals and pick them up

Food delivery services have always been costly. When you add up all the service and delivery fees, it can cost as much as the meal itself! Other apps such as EatClub offer last minute restaurant deals around Australia. This means you could be paying less for the same meal and since they don’t offer delivery options, picking up the food yourself can keep a few dollars in your pocket.

Total estimated yearly savings: $3,500 + any extra savings

Reduce entertainment and holiday expenses

1. Share your streaming services

If you’ve got more streaming subscriptions than you can count, perhaps this is one area you could cut back on. But if you like to have your cake and eat it too, then this tip is for you.

Consider teaming up with your family or friends to split the costs. One friend could pay for Netflix, while you pay for Disney+ and another friend could pay for Amazon Prime, while one more friend could cover the cost of Stan and so on. By splitting the payments across your group, you can access more for the price of one.

For example, adding all the above streaming services standard plans comes to $50 a month or $600 a year. By using this strategy, you could save around $204 a year.

2. Free activities to keep you entertained

You don’t always need to splash cash to enjoy the weekend! No matter what city or town you live in, there’s always free events or activities to enjoy, either on your own or with the family. From day trips to nature walks, farmers markets to festivals, exhibitions to geocaching, all you need to do to find out what’s happening in your area or region is a quick google search. Most large cities have blogs dedicated to free activities and events and if you’re not having much luck, try searching for free local events on Facebook or Eventbrite. This is a great way to fill your day with new experiences without having to break the bank.

3. Ditch the night out and host a night in

When planning a night with friends, we often jump at the opportunity to leave the house and get out and about! But a night out can often end up being very costly and it may only be something you can do occasionally. Have you ever thought about ditching the night out for a night in instead?

We’re guessing the answer is yes however, the thought of having to provide food to guests (which can be costly in itself, especially for large groups) and cooking and cleaning up afterwards may have put you off the idea. But why not get each guest to bring a plate? That way your work is minimised, your guests can feel helpful and you don’t have to spend lots of money on providing and cooking food for everyone.

There are many advantages of having a night in, especially when it comes to drinking and entertainment. You can enjoy any drink in your own home for much cheaper than buying one out and this extends to entertainment too, like watching sport or watching a movie. Plus, you can even break out some board games (if that’s your thing) or simply sit back and enjoy a good catch up in the company of your loved ones. And remember, you don’t always have to host. Why not share it around!

4. Shop for quality, not quantity

In a country like Australia, we’re incredibly lucky to be surrounded by lots of affordable stores but sometimes this means we have a tendency to buy too much and go for quantity over quality. Although we feel like we might be getting a better deal when items are cheap, we can spend more than we think because we end up adding more to our carts, rather than buying what we need. Often these items have a short lifespan and end up in landfill, causing us to go out and spend again. This can easily become a vicious cycle.

On top of that, we tend to gravitate towards brands to help us decide if the item is a high-quality product rather than actually assessing the quality for ourselves! For years brands have been cultivating customer loyalty and often this plays into our buying decisions. We may think buying from a higher priced brand means we are getting a high-quality product but this is not always the case.

If you want to get the best value for your item, it’s important you asses the quality first. Ask yourself; is this an item that will last? If so, does the price reflect its value? Is it timeless? Do you actually need it?

It might be better to splash on a higher priced item, which will stand the test of time over lots of poor quality items that won’t stand up to repeat usage or remain timeless.

5. Coupons, discounts and deals

Everyone loves a good deal and online sites, apps and even books now offer a wide range of entertainment discounts and coupons to make experiences affordable for all. How these typically work is you buy a book or a pay a membership fee at a small cost and in return you will receive hundreds of exclusive offers and discounts on dining, travel, shopping, entertainment, activities and lots more.

6. YouTube Premium – Kill 2 birds with one stone

This tip is a little different and doesn’t necessarily save you money, but does give you access to multiple services for almost the same cost as one.

If you or your family enjoy watching YouTube and use music streaming services regularly, YouTube Premium offers both in one subscription. It only costs a couple of extra dollars than a Spotify subscription but gives you more in return.

For example, YouTube Premium offers ad-free videos across YouTube and gives you access to premium YouTube content. It also gives you access to YouTube Music, which let’s face it, is basically the same as Spotify. You can even sign up with a family plan to add multiple devices to the same subscription which ends up costing the same as Spotify’s family plan.

7. The 24-hour rule

Sometimes we feel we really need something that we actually don’t and giving in to those impulse buys can often cost us lots of dosh! Give yourself 24 hours to sit on the decision. If in 24 hours you still think it’s a good idea then go back and buy it.

If you want to step up your game, you can take this further and apply a 7-day rule or for an even bigger challenge, enforce a 30-day wait period before you buy. Trust us, you won’t believe how much money this tip could save you!

8. Holiday with friends and save

Next time you go on holiday, consider bringing along some friends to help split the cost of accommodation, transport or other expenses. Accommodation can be the most expensive aspect  of a holiday, so getting a place you can split with friends or family can save you money.

Total estimated yearly savings: $204 + any additional savings

Bonus tips

1. Get a side hustle

This tip won’t save you money, but actually make you money! If you have a particular set of skills to freelance on the side; this can be an excellent way to bring in thousands of dollars a year. Most side hustles don’t require a significant initial investment to start and the best part is you get to work for yourself and choose your own hours.

2. Get yourself a killer budget spreadsheet

We all love a good spreadsheet, or is it just us? Most households should have some sort of budget to track any spending, but if you really want to track your spending to understand where you could be saving more money, a killer budget spreadsheet is your answer.

Lucky for you, we have one that you can download for free! Click here to download it.

3. Leverage your market value

Australia’s job market is just so hot right now! And for the first time in a while, it’s a candidate’s market. Wage growth has increased in a race to match Australia’s inflation (CPI) and job vacancies are at a record high according to the Australian Financial Review (AFR).

Experts say post-lockdown recovery and a workforce shortage has workers well placed to cash in on employee shortages. At the same time, employers have been forced to increase wages to attract and retain employees.

What this means for you is that it’s a great time to reassess your job value. Take a look at what your skills and expertise are worth in the current market and compare wage offerings with current job listings. You may realise you’re being underpaid in your current role and you can use this research as leverage to renegotiate your wage with your manager, or alternatively, you may be looking for an entirely new job in which case, know your value before you sign that contract!

4. Speak with your local MoneyQuest finance specialist

Whether you’re a homeowner paying down a mortgage, or repaying personal or business debts, your local MoneyQuest finance specialist can perform a health check on your loans and compare other rates on the market that might be the right fit for you. So, our last tip for the day is to contact us here or call us on 1800 886 100 to find out how we can help you.

Hopefully these 26 tips can help you reduce your cost of living and keep more money in your pocket. So how much could you save each year by following the tips above? The grand total comes to $5,866, plus any additional savings that we were unable to calculate.

Grand total estimated yearly savings: $5,866 + any additional savings

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