New research from Mozo has shown households could be saving thousands of dollars a year by making a few simple changes.
“While there’s not a lot you can do about higher petrol and food prices, there is something you can do about reducing your home loan, insurance and other personal finance costs,” Mozo spokesperson Tom Godfrey said.
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By making all the changes, households could save an average of $5,451 in the next 12 months.
People tend to “set and forget” their services, Mozo said, but taking the time to compare what’s on offer and switching to a more competitive product could see your savings rise.
Here are five ways to save as inflation rises.
1. Banking a more competitive home loan could save up to $3,000 on average
Although there’s speculation about when interest rates will increase this year, the fact is the cash rate is still at a historic low of 0.1 per cent and variable home loan rates are cheap as chips.
So, taking the time to compare home loan rates could save you $3,000 a year based on an average $400,000 loan paying principal and interest over 25 years.
Mozo found the average variable interest rate for an owner-occupier was 3.04 per cent, compared to just 1.79 per cent if you switched to the leading rate.
2. Logging onto a more competitive NBN plan could save you $1,017 a year
It’s easy to set and forget your home internet plan but, with more than 100 NBN providers offering services in Australia, comparing and switching could save $1,017 on an NBN plan.
3. Switching to a low-rate credit card could save you up to $567
With wages growth struggling to keep pace with the rising cost of everyday life, if you’ve been on a spending spree it’s easy to end up in a position where you’re carrying a balance forward on your credit card that you’ll need to pay back over time.
Mozo found switching to a low-rate credit card could save you $567 in the next 12 months on an average balance of $4,000 at 7.49 per cent, compared to a 20 per cent interest rate credit card.
4. Tapping into a high savings rate of up to 1.35 per cent could earn you $564
With household savings at record highs, banking the leading at-call savings rate in Mozo’s database of 1.35 per cent - instead of the average Big Four bonus savings rate of 0.23 per cent - on a $50,000 balance over 12 months could earn you $564 in additional interest.
5. Driving a more competitive deal on your car insurance could save you $303
Analysis of quote data from 35 car insurers across 9,503 customer scenarios for the Mozo Experts Choice Awards found huge price variances in what insurers could offer.
Mozo found an average price difference of $303 a year between quotes for comparable cover.
“By spending a few minutes seeking out a more competitive home loan, internet and credit card providers, the chances are you’ll have a little more money in the household budget to help cover rising costs of other products and services,” Godfrey said.