Cash-strapped Australian households who are struggling with cost of living pressures following November’s cash rate hike could save nearly $11,352 by proactively reviewing some of their biggest bills.
Personal finance marketplace Compare Club reviewed the average amount Australians could save by reviewing their insurance policies (health and life), home loans, energy bills, car loan, and credit cards and found the average savings were now as high as $11,352.
The amount hard-pressed households could cut from their bills has grown since Compare Club first started tracking the average potential household savings. In May, the average saving was $7,388 across 12 months by switching the same products.
Mortgages, car loans, and energy bills all have higher potential savings than six months ago as lenders and retailers bring better offers into the market.
“This really shows the value of doing a quick check on some of your biggest bills,” said Kate Browne, Compare Club’s Head of Research. “Yes, energy bills and interest rates have both gone up, but that’s also meant a lot of lenders have some competitive rates, while items like energy bills and health insurance are easy to cut, as we know many Aussies just aren’t on the most competitive plan for them.
“With the expense of Christmas just around the corner, there’s no better time to do a financial health check. It’s a highly competitive time across Home Loans, Health Insurance, Car Loans, Energy, credit cards and life insurance. You can set aside a couple of hours this weekend to shop around and the savings are enormous.”
Home Loans Average Savings: $4,680
Home Loans had the biggest average saving of $4,680, with Compare Club’s brokers knocking an average of 0.8% from people’s interest rates. This is based on an average mortgage of $585,000 on an average variable mortgage rate of 6.67% average mortgage, with compound interest is taken into account. This is above average savings of just over $2,600 in May*.
“Compare Cub has mortgage brokers who can take a helicopter view of all the loans on offer across all lenders, not just the big four. Our lenders also are able to secure special deals only available to lenders, so it’s worth a call to check if you can get a better deal on your loan,” said Kate.
Credit Cards Average Savings: $843
The average Aussie has a credit card balance of $2,296, with $1,046 of that currently getting hit with interest at a rate of 19.82%. Moving all this debt to a 32 month 0% balance transfer credit card could save $843 in debt accruing interest over 12 months.
“Credit card debt can spiral but it’s also one of the easiest debts to get back under control, There’s a number of exceptionally good fee-free balance transfer cards available on the market that give you time to paid off your balance and avoid getting hit with interest,” said Kate. “Also, check if your new card has an interest free period for new purchases, in case you plan on using it.”
Car Loans Average Savings: $3,566
According to car finance brokerage Car Clarity, the average car loan interest rate now sits at 15.04% with the average amount refinanced jumping from just over $30,000 to just under $40,000.
With an average new loan rate of 10.02%, it means the average amount saved on a refinanced car loan has jumped from $2,600 to $3,566.
“Many people take out their car loan when they walk into the dealership,” said Kate Browne, “but these are often very poor value for money and can add thousands onto your overall repayments. Dropping 5% makes a massive difference to your monthly repayments, so if you didn’t shop around when you first took out the loan, it’s still not too late to save.”
"Even if you don't think there's much to be saved, it's worth reviewing everything. Just switching your health cover and energy could put an extra $600 back into your bank balance," said Kate.
Average Health Insurance Family Savings: $421
By checking both the cost of the premium and extras on offer, on average:
Families can save $421.46.
Couples can save $213.32.
Singles can save $227.46.
Single Parent Families can save $370.20.
“We need to look beyond the cost of the premium and consider the overall value on offer. Compare Club can dig into the extras and help you get more cash back with one phone call. There’s no paperwork and Compare Club does it all for you,” said Kate.
Energy Average Savings $346
Victorians have the biggest potential savings here with many retailers bringing in competitive discounts for new customers.
In May, the best deal on Compare Club’s panel was $183 less than the reference price, but that’s now $510. Regional NSW residents also have the potential to save up to $481 below the reference price. Potential savings by state or distributor area are below.
“There is lots of competition in the market right now, which is great news for customers. Yes, energy bills are higher but so are the potential savings. There’s a good chance some of the current deals may be the best we will see for the next 6 months, so it’s worth switching before a scorching summer.
"Some providers will even let you lock in today’s price for the next 6-12 months to help you ride out the summer price hikes, so if you’re going to switch any bill, start with energy. It’s the quickest and easiest to switch and offers big savings” said Kate.
Life Insurance Average Savings
Some of the biggest savings come for people who’ve given up smoking or vaping. A 50-year-old office worker in NSW with $1m worth of cover could see their premiums drop by $1,643 if they’ve stopped smoking.
“If you have life insurance and you’ve made a significant lifestyle change, it’s worth reviewing your policy. Many people set and forget life cover or think they can’t save that much, but our team is regularly finding Australians better cover.
"Even if you can’t save that much, you may be able to get a higher benefit payout from a different insurer for the same price, so it pays to review this expense,” said Kate.
The bottom line on savings
“As Christmas looms, many Australians are feeling the budget pinch. The good news is that with a quick call to Compare Club or visit to our website, we can help you save as much as $11,352,” said Kate Browne, Compare Club’s Head of Research.
For more information:
Jasmine Kostas Media + Capital Partners press@compareclub.com.au
Notes to editors
Data taken from a combination of the ABS, RBA, Car Clarity, and Compare Club's internal data. All savings are average only and are correct as of 1 November 2023. Some households may save less or more. Any advice on this page is general in nature. Households should always check with a financial professional before making any major decisions.
