How to save on household spending

Economists may consider we are living with low inflation at the moment, but the fact is that many older Australians are struggling with price increases.

The latest Consumer Price Index figures show that inflation was just 1.9 per cent in the 12 months to September, according to the Australian Bureau of Statistics (ABS). That figure is an average of the price increases and decreases of a ‘basket of goods and services’.

Included in that basket is childcare, and a fall in its cost last year helped to bring the average inflation rate down. Naturally, retirees do not need to pay for childcare so that rate isn’t completely relevant to older Australians.

When goods and services are taken individually, some of the hikes will most certainly be hurting retirees’ wallets. Among the biggest rises were for health (3.2 per cent) and transport (six per cent) costs, but food and non-alcoholic beverage prices also rose, albeit at a more modest 1.6 per cent.

In YourLifeChoices’ Retirement Affordability Index September 2018 edition, The Australia Institute estimated that across all tribes, retiree couples spent an average of $9360 a year on food and non-alcoholic beverages. A 1.6 per cent hike on that amount equals about $150, which is more than just loose change.

Here are some tips on how you can stretch your dollar further. 

1. Groceries
For those aiming to reduce their weekly grocery bill, there are many ways to save at the supermarket. If you haven’t used discount codes, coupons and vouchers to make online purchases, you are missing out on potentially hundreds of dollars of savings a year.

The discounts are easy to find with a simple Google search. I looked up and found many household items marked lower than shelf prices at supermarkets.

If you are lucky enough to live near a Costco – there are 11 of them around Australia, with another planned for Perth – you can expect substantial savings on a huge array of products, from fresh and frozen foods to diamonds and hearing aids, as this chain offers wholesale prices. There is an annual fee of $60.

The Thrifty Issue site is full of saving strategies on grocery bills. Not only does it detail how to access discount codes, it also sells a book full of discounts for less than $5. The 2019 version can be ordered now.

If you enjoy eating out but find the cost prohibitive, don’t forget to check out the cafés and restaurants that offer discounts to older Australians with a Seniors Card. Scan the directory of outlets in your state or territory (Victoria, NSW, ACT, South Australia, Western Australia, Tasmania, Queensland, Northern Territory) to discover where savings are offered.

2. Health
As with death and taxes, another of life’s inescapable certainties is that there will be an increase in the cost of private health insurance every April.

The cost of private health cover has risen 54 per cent since 2009, making it one of the most expensive items in Australian household budgets.

Each year, the hike is many multiples of inflation, but in 2018 the increase was pared back slightly to 3.9 per cent. This helped to contribute to an overall annual rise in healthcare-related costs of 3.2 per cent.

If you want to shop around for cheaper health insurance that meets your needs, a good starting point is to visit the Private Health Insurance Ombudsman’s comparison site and complete a quick questionnaire. The site will enable you to compare your current policy with others.

The site generates a list of the health funds that match your answers and the monthly premium before the government rebate. You can do the questionnaire as often as you like and vary your answers in order to flush out suggestions that match your needs.

But be wary of comparison sites that have vested interests in promoting certain health funds over others because of the commissions they earn. For instance,, lists its partners as being the major providers, but omits two of the largest health insurers.

Also, be mindful that some newer policies have dropped a few of the legacy benefits of earlier ones. And check the terms and conditions carefully before changing policies – buyer beware indeed.

3. Transport
You don’t have to wait until you retire to be eligible for public transport concessions. So if you have already turned 60 and are working less than 35 hours, you are most likely entitled to a Seniors Card, which allows you to commute for much less than a full fare. Check out the criteria in your state.

For those times when you need your own wheels, buying the cheapest fuel is a no-brainer. The Australian Competition and Consumer Commission said petrol pump prices jumped 10 per cent in the 2018 financial year.

There are several websites and phone apps to steer you to cheaper fuel outlets. If you live in Victoria, check out the RACV fuel prices tool. It is essentially a map highlighting the prices advertised at different petrol stations. It also offers the average price and a recommended price above which you should not pay.

For links to motoring groups in other states and territories, visit the Australian Automobile Association.

If you are on the go, sometimes an app on your phone might be easier to look up. Among the popular and free fuel apps are petrolspy and fuelmap.

4. Travel

According to the ABS, one of the biggest price rises that hit retirees hard in the September quarter was the cost of overseas travel. The September quarter coincides with the peak summer season in Europe and America, making travel more expensive to those continents.

For the best shot at reducing your holiday costs, make sure to read YourLifeChoices travel articles on Saturdays and keep an eye out for more deals on the Skyscanner website.

Another factor making international travel costlier at the moment is the subdued Australian currency. However, there are many countries in Asia where our dollar can still deliver reasonable bang for your buck.

Finally, while everyone hates to buy travel insurance, it would be unwise to skimp on it just to save money. The good news is that there are several organisations offering cheaper premiums to travelling seniors.

Compare policies with Australian Seniors Insurance Agency, COTA, AIG Australia or APIA for the most appropriate cover.

Do you have any tips on other areas where you can cut spending? Have you tried any of the websites listed above? Do you have any feedback about them?

Related articles:
How supermarkets get you to spend
Six tips to cut your travel costs
Annuity v account-based pension

Written by YourLifeChoices Writers

YourLifeChoices' team of writers specialise in content that helps Australian over-50s make better decisions about wealth, health, travel and life. It's all in the name. For 22 years, we've been helping older Australians live their best lives.

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