David ‘Kochie’ Koch is Compare the Market’s Economic Director, leading research and campaigns to help Australians make educated financial decisions.
When you look back on 2023 in ten years’ time, the one thing you might remember is just how expensive everything from petrol to power and even chips and chocolate got.
That’s why we need to make 2024 the year of the financial fightback.
Yes, some price hikes will be hard to avoid. But if you’re proactive, and spend 20 minutes tackling a different bill each day of the next week, I reckon you’ll have set yourself up for better budgeting this year.
The best part? You can tackle most of these expenses by doing a quick comparison, shooting off an email, or making a call.
They’re so easy you can get many of them done on the train to work or between ads on the telly.
Fight back against price hikes
We’re all getting used to prices going up but having a relaxed attitude won’t do you any favours.
Compare the Market survey data shows 72.1% of Aussies haven’t switched energy plans for over a year.
That’s surprising when average prices for families on so-called “standing offers” in New South Wales increased between $315 and $435 in July.
There are often much better offers on the market for those willing to sniff them out.
And the savings are greater the more bills you tackle. After you’ve compared energy plans, move on to your insurances.
A Victorian couple with a 2019, Volkswagen Tiguan saved $762 when they compared their car premium in December.
Supercharge your super
These days most employers offer salary sacrificing so you can put up to $27,500 of your pre-tax income to make extra contributions to your super.
Any contributions you make will be taxed at 15% – that’s probably a lot better than the marginal rate you’ll otherwise pay in tax.
Make your money work harder
Interest rates are up – that means we can’t afford to let our hard-earned savings languish.
That could mean paying off any high-interest debts, putting your money in a top-rated savings account or storing it in an offset account to reduce the interest on your mortgage.
Compare the Market crunched the numbers and found that having just $25,000 in an offset account for a $500,000 loan with an interest rate of 5.84% could reduce your loan term by two years and 11 months and save more than $100,000 in interest over the life of the loan.
| Amount in offset | Total interest you could pay | Total interest you could save | Your loan term could be reduced by |
| $5,000 | $537,630 | $23,115 | 7 months |
| $10,000 | $515,758 | $44,987 | 1 year, 3 months |
| $25,000 | $456,620 | $104,125 | 2 years, 11 months |
| $50,000 | $375,204 | $185,541 | 5 years, 2 months |
| $100,000 | $291,044 | $405,292 | 10 years, 1 month |
| Example based on a $500,000 variable rate (5.84%) home loan, with a 30 year term. Calculations assume a constant daily balance of $5,000, 10,000, $25,000 and $50,000 and $100,000 in an offset account and minimum repayments ($2,947) being made throughout. | |||
Do away with upgrades
We’ve all been sucked into the race to have the latest and greatest devices. Next time your phone plan is up yourself, ‘do I really need a new phone?’
Sticking with an old device and switching to a cheaper phone plan could save you hundreds of dollars a year.
For example, keeping your old phone and choosing a bare-bones $30 data plan, instead of choosing a new phone with a $70 data and payment plan, will save you $480 over a year.
Find the hidden rewards
Major supermarkets allow you to “boost” your points within apps to maximise points that can be redeemed for store credit.
Meanwhile, insurers and energy retailers often have exclusive deals and discounts to sweeten the deal for members.
Having Woolworths Everyday Car Insurance, for example, gets you 10% off one grocery shop every month. If you use the discount on a grocery shop of $160 each month you’ll save $192 over a year.
Fuel for thought
Use fuel comparison services to find cheaper petrol on your way to work or drop the kids off at school.
There can be huge discrepancies between fuel stations at different points in the fuel cycle.
One Compare the Market employee saved $291.88 in a year by using the Simples App to
help her track down cheaper prices to fill her Kia Rondo.
That money you save might even be enough to cover your next car service!
I hope some of these tips help you save smarter this year, to help you reach your money goals and grow your budget for the stuff that really matters.
