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Beat the top five barriers to saving

2019-09-25

Article proudly brought to you by ME.

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Just over half of Australians aren’t saving any of their monthly income [1] , and five key costs are the main culprits.

A recent survey revealed that everyday bills; rent; home loans; shopping, dining out and socialising; and school/daycare are Australians’ top five savings barriers [2] – industry super fund-owned bank ME reveals what you can do to trim the costs in these five areas.

 

1. Everyday bills

Each year you face a raft of bills – anything from electricity and mobile phone/internet charges through to car cover and home insurance.

But how often do you check if you’re getting the best possible deal?

Instead of automatically paying your bills, research whether you could cut costs by switching to a new provider. It only takes a few minutes, but it could turbocharge your ability to grow your savings.

 

2. Rent

Saving on rent doesn’t have to mean sharing with a dozen housemates or being 10th in line for the shower each morning.

Rent is largely shaped by location. If you’re prepared to live a few extra train stops from the city, chances are you’ll save.

Look for properties with features that can cut your other bills. Apartment complexes with a residents’ gym, for example, can see you save on gym fees.

When you find a place you like, consider signing up for a longer lease in exchange for a cut in rent. Landlords love to minimise vacancies, and by agreeing to a 24-month lease rather than a 12-month lease, the landlord may knock a few bucks off the weekly rent.

 

3. Home loans

After back-to-back RBA cash rate cuts in June and July, some lenders are offering their lowest home loan rates ever. 

That means plenty of scope to get a better deal on your home loan. There can be costs in switching so look at the time taken to recoup these expenses – the sooner you do, the more worth it switching is.

 

4. Shopping, dining out and socialising

Convenience apps and buy-now-pay-later options could be having a big impact on your ability to save.

Afterpay, for example, notes on its website that “Afterpay customers spend more per transaction” [3] . A simple way to save is by paying with a debit card. This way you’re limited by the balance of your bank account.

Go easy on the food delivery apps too. It’s estimated Australians each spend an average of $1,590 annually on home-delivered meals and drinks. Enjoy an affordable social night in by organising a pot luck dinner, where each guest brings a dish to share, or by cooking a vegetarian (hence low-cost) dish for them. It’s a fun way to save.

 

5. School or daycare

Putting your name down on a childcare centre’s waiting list while you’re still on maternity leave can mean securing a spot at a more affordable centre. Or think about teaming up with a likeminded family to hire an au pair. It can work out cheaper depending on the number of children involved.

When it comes to school costs, if a private school is on your wish list, be sure to enquire about bursaries and scholarships that help to reduce fees. Check out local ads for pre-loved uniforms to kit out your child for a fraction of the normal cost.

 

This article is brought to you by ME. For more information, please visit www.mebank.com.au

Members Equity Bank Limited ABN 56 070 887 679 AFSL and Australian Credit Licence 229500.