Most Australians worried about cost of living: where can you cut costs and save?

With both inflation and rising interest rates pushing up the cost of living around Australia, many of us are considering different ways to cut expenses and save a dollar or two. But where can Australians make the most effective cuts to their household budgets, and how can they maximise their savings?

New research from Advertising Week APAC (AWAPAC) has found that 97 per cent of Australians are “extremely concerned” about the rising cost of living, and over 40 per cent of Australians are making lifestyle changes to keep up.

Australians slash dining and streaming budgets, but still saving for holidays

The two areas AWAPAC identified as being hit by cost-cutting from consumers are dining out and entertainment. The research found that 63 per cent of those surveyed will cut back spending on dining at restaurants or takeaway, while 61% have cut back on purchases at their local café. Around 34 per cent of those surveyed were considering cutting back on subscription services, with video streaming services such as Netflix and Stan the most likely to be cut (48 per cent).

That said, Australians were found to be sticking to their travel plans, with 37 per cent of those surveyed saying that despite the rising cost of everyday items, they are still continuing to save for overseas holidays.

Advertising Week global president, Ruth Mortimer, said that with Australians being hit with higher prices across multiple sectors, “now is a critical time for brands to reaffirm their relevance and value in consumers’ lives.”

“We will see big brands considering new ways reward loyalty or introduce better value options rather than a one-off deal or discount.”

How else could you cut costs and save?

Depending on your financial situation, there may be a few other options to consider to help free up some extra money in your budget.

These could include:

• Refinancing your home loan, personal loan or car loan to a lower rate to save on repayments, or to benefit from more flexible repayment options
• Paying off and cancelling credit cards you don’t use or barely use, to save on annual fees and potentially interest charges
• Comparing home insurance, car insurance, phone and internet providers to see if alternative options could offer services of similar value at a lower cost
• Using a debt consolidation loan to roll several smaller outstanding debts into one, giving you just one repayment to keep track of and potentially helping you pay less in fees and interest charges. 

For more options to cut costs and save, check out RateCity’s 20 tips and how to prepare for a recession.

To help accelerate your progress towards your savings goals, whether that’s a holiday or something else, you could:

• Compare savings accounts and switch to an option that offers a higher bonus interest rate that suits your saving style
• Invest part of your savings into a high interest term deposit
• Compare rewards credit cards with points plans that could be used to help you achieve your goals e.g. frequent flyer rewards for discounted overseas flights
• Investigate home loans that offer cashback rewards and similar sign-up bonus offers that could provide extra value (provided they also suit your financial situation)

Remember that the best choices for you will depend on your personal circumstances and financial situation. Consider contacting a financial adviser for more specific advice.

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