Remember when you were a kid and couldn’t wait to be an adult? Before you found out that life was one long road consisting of work, bills, and cooking dinner. This week we’ve been thinking about all the household expenses we pay. Mobile phones, insurances, utilities, and even our home loans. I’ll be honest, I’ve worked for an energy provider, an insurance company and within the banking sector, and I should know better, but I don’t compare prices and I’ve never tried to cut household expenses. Well until now that is!
Just like most of you reading this, I’m busy. Bills arrive on email, join the long list vying for my attention, get a quick open, I pay them and I move on. Every now and then, ‘comparing prices’ gets added to the to-do list, but before long, they get knocked down the list and drop off. I’ll do it next time. When I find the time. Let’s face it, who even has the time?
Compare and save
It’s a timely reminder that we’re the ones in control of our bills, not the other way around. Let’s take action, one household expense at a time, and work towards spending less and living more.
We decided to start with the main bills and see just how much money we could save. We’ve looked at what else is on offer, but we’re not just chasing cost savings. It’s important to remember when you start to compare providers you need to make sure you’re comparing like with like.
Some car insurance policies may appear hundreds of dollars cheaper but that’s because they don’t have the same inclusions or higher excess. Some energy provider quotes may be cheaper but then come with large fees for any changes you make. Sometimes you may be really happy with your provider and want to remain with them, just not so happy about the cost.
If you’re going to make changes to home loans, super or insurances we’d recommend you speak to a professional first. These ideas are to get you motivated, learn what you’re paying for, and take control of your outgoings.
Car, home contents, and building insurance
I have my car, building, and home contents insurance policies with one provider. They hooked me with the bait that they would provide the extra discount for having everything with one insurance company. Every year they send my renewals. I look at them, think about getting quotes elsewhere, and then pay them. I’m really happy with my insurance provider. If I have any issues they deal with it instantly. The people they have on the phone are well trained and knowledgeable and I didn’t really want to move. So, what could they do for me?
After a 15 minute conversation, I had reduced the price of my building, home contents, and car insurance and made a saving of over $300. Not often I make $300 in 15 minutes. When I spoke to my insurance agent he said I should phone him every year to have this same conversation.
Excited by my first successful phone call, and overcoming my fear of negotiating a better deal, I kept going.
Mobile phone plans
There are so many options now and many offer great deals, particularly if you own your own phone. Firstly, do you know if you’re on a plan or if it’s expired? Do you know how much data you use a month, and if your existing plan fits your usage? Get all this information first.
When you start to compare you find suppliers providing the same in terms of product for vastly different amounts. Many of them use the same network. When was the last time you checked your mobile phone plan against other providers to see what you can save? I found a plan with a provider that uses the same network as the current one I’m on, has the same inclusions, and can offer $64 less per month! I know, right! That is crazy. A saving of $768 over 12 months.
The competitive nature of the current electricity and gas market gives you more choices. How many of us continue to use Energy Australia or AGL? It’s easy to feel intimidated by the number of suppliers that are now on the market. Will you save money? How do you know if changing will be beneficial for you?
The Australian government now has a website you can use that will help you to compare prices. Answer some simple questions about yourself, make sure you’ve got a bill at hand so you can input accurate usage figures and see what you can save.
Check your options here: Energy Made Easy: The Power to Compare
There’s a lot to consider with your superannuation. We tend to set up our super when we start working. Then we forget about it until we start to approach our retirement and wonder why we didn’t take more notice. We recommend that you get professional advice from a financial advisor before making changes. If you haven’t thought about your super for a while check out what fees you are paying. There are huge variances between companies.
Are you getting the best deal? Have a look at their performance too. Are they giving you a good return? Are you happy with the companies that they invest in? Are you paying for things you don’t want or need? If you haven’t reviewed your super in a while it might be a good time to seek advice. Your future self will thank you.
We’ve just been talking about our home loans in the office. We’re all paying mortgages that have different interest rates. One over 5%! Once a year I phone my home loan provider. Every time I phone them they reduce my interest rate. EVERY time! Once they even explained to me that if I could reduce my mortgage by another $20,000 they could further reduce it. I ploughed every spare cent into doing this. The day I achieved it I phoned them. They reduced my interest rate by another quarter of a percent.
Give your mortgage lender a ring today. If you don’t get anywhere consider approaching a mortgage broker and refinancing. If you have other debt as well as your home loan you can also consider refinancing to reduce your monthly outgoings. Read more about reducing debt here: Feel like you’re drowning in debt? Find out what you can do.
Home phone and internet
How many of us still have a home phone that we never answer? I have mine attached to an answering machine that allows me to filter out all of the sales calls and scams that come my way. The only people who ring it are my Mum and mother in law! My home internet is included as part of the package. This gets a lot more use, particularly as my children grow older and we’re all on different devices. If you have a home phone and internet package and only ever use your mobile you could consider changing your plan.
I checked our home phone which has unlimited data and found small monthly savings. The best I could find was a $10 saving monthly but over the year that’s $120 in my pocket. Once again, be aware of set up costs or break costs if you are on a contract.
Life insurance, total permanent disability insurance, and income protection
I have my insurances through my super provider and after doing some research I think I’m onto a winner here. While looking at this it has made me reconsider the amount my husband and I are insured for. Not just in terms of raising insured amounts but also to reduce them as the amount of our mortgage and debt decreases.
I’d recommend talking to a financial advisor or doing some investigation yourself to see if you’re getting value for money and have under or over-insured yourself.
This has been a great exercise in saving some money for our team. We haven’t looked at everything, many of us will have caravan insurance, boat insurance, landlord insurance, credit card debt, and personal loans. The list is long.
My mother always said, “Don’t put off until tomorrow what you can do today.” This is great advice and I wished I’d listened sooner.
Also, add this to your list
Recently, I finally got around to arranging Wills, Power of Attorney, and Enduring Guardianship. Another job on that long list that I never found the time for. Knowing my family will not have to worry if the worst were to happen has given me even greater peace of mind. If you’re in the same boat, have a read of this article on why you need your Will sorted: Do I need a Will? You need to read this first!
Give yourself a little time every week to invest in saving yourself money. Don’t be overwhelmed, just tick one thing off the list each week, even monthly, and take control of your living expenses. You’ll be glad you did.