The tide may slowly be turning on the cost-of-living crisis, with new research from Compare the Market revealing fewer people are imposing lifestyle lockdowns to combat rising expenses in 2025 compared to 2024.

The research found that 71.2% of Aussies planned on making lifestyle changes over the next 12 months amid the cost-of-living crisis – down from 77.2% in June 2024.*

Around a third of respondents (36.9%) said they would be socialising less in 2025, including cutting back on eating out, drinking alcohol or consuming takeaway coffees – an 8.5% drop compared to June 2024, where the figure was 45.4%.

Holidays also seem to be taking a hit, with 34.4% delaying their vacation or putting plans on hold to bolster their savings – also a slight dip from the 37.1% of Aussies who were putting their holiday plans on ice in June 2024.

Big ticket purchases are also on the chopping block for 28.1% of Australians – down by 7.8% compared to 2024.

Compare the Market’s Chris Ford said Australia may be entering a new era amid the cost-of-living crisis.

“Slowly but surely, we’re seeing inflation return to the RBA’s target range, which means many Australians are feeling more comfortable spending their hard-earned money on things like dining out, catching up with friends or even their dream holiday,” Mr Ford said. “The latest figures from the Australian Bureau of Statistics also show that discretionary household spending is slightly up month on month.

“Having said that, we’re not entirely out of the woods when it comes to the cost-of-living crisis, so while it’s a promising sign to see fewer Australians impose lifestyle lockdowns, we know a large chunk of the population is still keeping a very close eye on their finances. And, of course, it makes sense that it’s non-essentials that are the first to go if people are trying to bolster their savings or keep themselves out of the red.”

However, Compare the Market’s data also found that some Aussies are making even more dramatic lifestyle changes to keep their head above water in 2025. Around 14% of Australians said they’re considering changing jobs to one that pays more, while 11% of respondents would be moving to a different town, city or even overseas to combat rising costs.

Some Australians will also be leaving themselves underinsured, with 14.4% of people lowering the level of cover on their insurance products like car insurance, health insurance and home and contents insurance, and 8.2% cancelling their insurance completely.

“Before ditching insurance completely or dropping your level of cover, it’s a good idea to do a comparison to ensure you’re not paying more than you need to. Your loyalty to an insurance company or utility provider could be costing you,” Mr Ford said. “The last thing we want to see is people being left unprotected or underinsured, so see if there’s a way to maintain cover without paying more than you need to.

“Chances are the next time you’re hit with an insurance renewal letter, it’s going to be higher than what you paid in the past. Rather than just accepting it, do your research and see if you can beat the price.”

Compare the Market also found that other lifestyle changes Australians are planning over the next 12 months include:

• Delaying having kids: 7.1%
• Downsizing: 6%
• Changing to a remote work job to save on transportation costs: 5.9%
• Delaying marriage: 4.3%
• Selling a car: 3.8%

Mr Ford said there were ways to cut back on spending without giving up things completely.

Claw back cash in other ways

Rather than giving up things completely or going without life’s little luxuries, see if there are smarter ways to save. If you haven’t switched energy retailers in more than a year, there may be better deals available on your gas and electricity. Also ensure you put any insurance renewal under the microscope and never take a premium increase lying down.

Reap the rewards you’re entitled to

You may not even be aware that you may be entitled to cheaper goods or discounts through your insurance providers, telcos, energy retailers or utility companies or have access to movie tickets, entertainment, dining experiences and more. Also keep an eye on takeaway outlets and supermarkets, which may offer reward programs that entitle you to cheaper items.

Delivery could be costing you

How much is your food delivery really costing you? And could you save by picking up rather than opting for delivery? Some food delivery apps charge a delivery fee or hit you with a minimum spend requirement to waive the fee.

Wake up to savings
While putting money aside for a rainy idea is a great way to save, it’s not the only one. You may be able to claw back cash by switching to cheaper insurance or energy plans. And the next time you receive an insurance renewal, make sure you don’t just accept it. Always do your research and consider switching if a better deal is available.

*Survey of 1,010 Australian adults, conducted December 2024. Survey of 1,006 Australian adults, conducted June 2024.

For more information, please contact:  

Phillip Portman | 0437 384 471 | [email protected]

Compare the Market is a comparison service that takes the hard work out of shopping around. We make it Simples for Australians to quickly and easily compare and buy insurance, energy, and home loans products from a range of providers. Our easy-to-use comparison tool helps you look for a range of products that may suit your needs and benefit your back pocket.