Your Life

Money focus: How can I reduce the cost of living?

- April 4, 2022 7 MIN READ
Money focus - reduce the cost of living

Each week we ask a question to help you focus on an area of your finances that might need a closer look. This week: How can I reduce the cost of living?

Oh boy, are we all getting hit with the cost of living stick right now. Fuel prices are through the roof, rent is sky-high and you need a second mortgage just to do the weekly shop (that’s if you can get a mortgage in the first place!).

Your ‘cost of living’ is the amount of money it takes each year to maintain your lifestyle. Many factors contribute to this, including your family structure, where you live, how you live and what the general economy is doing at any given time. Right now, the general economy is basically sucking you dry, no matter where and how you live.

$250 bucks worth of laughs

In the recent Federal Budget, a $250 cash boost to help with cost of living pressures was announced. It will be a one-off financial boost that benefits around 6 million Australians pensioners, carers, veterans, job seekers, eligible self‑funded retirees and concession card holders.

“Events abroad are pushing up the cost of living at home,” Treasurer Josh Frydenberg acknowledged when the cost of living payment was announced on budget night. “Higher fuel, food and shipping costs are increasing inflation and stretching household budgets.”

The pandemic, freight costs, extreme weather and the Russian-Ukraine war have all created supply issues that have sent the price of food and petrol sky-high. Sorry Mr Frydenberg, but $250 bucks isn’t nearly going to cut it.

It’s clear that we’re going to have to save ourselves. Here are some steps you can take to lower your current cost of living to keep ahead of inflation.

Focus on the ‘big three’ household expenses

The ‘big three’ household expenses are what Australians spend most of our money on: housing, transport, food.

It goes without saying that because so much of our money goes into these things, it’s also where the biggest savings can be made. So to reduce the cost of living, let’s focus on these three areas.

  • Housing – including your rent or mortgage and your utilities.
  • Transport – including car costs and public transport.
  • Food – including groceries, alcohol and eating out.

1. Housing


If you have a mortgage, you have room to negotiate your housing costs. Here are your options:

Negotiate with your current provider: Make the call to ask your existing home loan provider for a lower interest rate. Here’s how to do exactly that: Right now is the time to negotiate your interest rate

Change providers: It’s not right, but so often new customers get the better deal from the banks, no matter how hard you negotiate. If that’s the case for you, be prepared to refinance so you can become a new customer somewhere else.

Extend your loan term: This isn’t a good strategy in the long-term because you’ll end up paying more interest on your loan. But if you’re really struggling to meet your monthly repayments, talk to your mortgage provider about extending the term of your mortgage to reduce your monthly repayments.

Rent out part of your home: To help meet your mortgage costs, you could lease out your garage or car space, or turn a spare bedroom into an Airbnb. Find out how to do all of these things here: 19 ways to make the most of the share economy


It’s not easy to lower a fixed cost like your rent, but there are a few options you can try.

Move somewhere cheaper: The first option is probably the least palatable. There are a few factors that make moving a tough thing to do. First up, rental prices are soaring, so you might not be able to find somewhere cheaper in your area. Secondly, rental properties are in short supply right now, so it might be hard to find somewhere full-stop. Thirdly, you might not want to move to a different, less expensive area. However, if you can say yes to all of the above, renting a cheaper place will definitely reduce the cost of living.

Share the rent: If you have room available, bring in a new flatmate to reduce your rent and other living costs.

Apply for a rent reduction: If you think your property has experienced a loss of amenity (eg. non-urgent repairs haven’t been made) since you first moved in, you might be eligible to request a rent reduction.

Pay up front: your landlord might reduce your overall rent if you offer to pay three or six months in advance.

Rent out your parking space: If a parking space is part of your rental, you could sub-let it and make some of your rent money back. More info on how to do that here.


After your rent and mortgage is paid, you’ve still got to pay your water and energy bills to keep the home fires burning. Reducing your use is the fastest way to lower your bills. Here are some resources to help you with that:

2. Transport

How ’bout ‘dem fuel prices, eh? It cost me over $200 to fill up my car last night and, no, I wasn’t filling my car up with margaritas.

Owning a car has always been expensive, but right now it’s ridiculous. So here are some thoughts on lowering your overall transport costs to significantly reduce the cost of living.

Take public transport: Sure, it’s more inconvenient than getting in your car and driving A to B, but right now it’s much cheaper to get the bus via X, Y, Z. Using an app like TripView (NSW) or PTV (VIC) will help you plan your most time-effective journey. Google to find the best app for your area.

Car-pool: Sharing rides with friends and colleagues can save you plenty.

Walk or ride: Don’t use your car for distances that you could walk or bike ride instead. This will significantly reduce your petrol and car running costs.

Ditch one of your cars: See ‘public transport’ above – could one of your household members permanently take the train instead of driving?

Change cars: You can save on ongoing running costs by changing your current car for a smaller, more efficient model or by swapping to an electric vehicle. This will help you save money when you’re buying your new car too: The financially sensible guide to buying a car

Use a petrol app: Find the cheapest petrol in your area using a convenient app: 6 of the best apps to track cheap petrol prices.

Bring your vouchers: Vouchers from supermarkets can get you 4-6c a litre off your fuel. Just don’t forget to bring your shopping docket with you. To streamline things, use the supermarket card or app so you’ve always got your discount in your pocket. Then make sure you drive into a participating petrol station to take advantage of the discount.

Continue to WFH: Research from the University of Sydney estimated that working from home saves an average of $906 out-of-pocket and $2643 in travel time savings every year.

Negotiate your car insurance: Making some changes to what, where and how you package your car insurance could save you plenty. This is how it went down for me: I saved $5,416.78 just by making three phone calls

3. Food

I’m embarrassed to tell you how much my family spends on groceries each week. Let’s just say it’s substantially above the average of $156 per week. I look at that figure (based on 2021 data) and think we must be a nation of tiny old people.

In any case, like me, you’re thinking you could easily reduce the cost of living by saving some money on your food shopping each week. Here are the best ways to lower your grocery and other food costs.


It’s a no brainer to do things like buy generic brands and buy in bulk when the food you like is on special, but let’s take it next-level.

Take on the challenge: We did the Discount Grocery Challenge and saved $8,364 on groceries in a year. So definitely do that! Spoiler alert: it helps if you have an ALDI in town…

Use an app: Apps like Frugl and SmartCart can help you shop your grocery list for less. They can also streamline your shopping process, which is like the cherry on top.

Meal plan: Stop resisting and start plotting out your food each week. Countless frugal-types will tell you it’s the fastest way to save money on your groceries.

Shop with gift cards: Whenever you see a gift card for your favourite supermarket on special, buy up big. Then simply use the gift card to buy your groceries. You can save 5 or 10 per cent off your total grocery bill this way. You can get access to permanently discounted gift cards through organisations like the  NRMARACQAGLMacquarie Bank and RAA. All offer their members discounts on gift cards that are redeemable at most supermarkets.

Join supermarket rewards programs: Both Coles and Woolworths have a rewards program that can help you save on groceries. Coles has Flybuys and Woolworths has Everyday Rewards, both give you access to money off vouchers, rewards and discounts off fuel. If you’re good at paying off your credit card in full every month, then using a credit card partnered with either Coles or Woolworths could save you even more.

More ways to save at the supermarket:

 Eating out

You could stop eating out altogether and save 100 per cent on your eating out costs… But that’s not much fun, is it?

Use your government vouchers: If you’re in NSW, you’ll have received a bunch of Dine and Discover vouchers. Find a venue that takes them and enjoy money off your next meal on the government.

Eat out mid-week: Many restaurants (even fancy ones) off mid-week discounts, so save your night out for Mon-Thurs.

Become a member: If you like dining out at clubs and pubs, become a member. It can often result in saving a fair bit off your food bills to reduce the cost of living. Don’t underestimate the food at your local either – things have come a long way since the ‘roast of the week’ days. Many club venues are operated by top chefs.

Eat early: Some places offer a reasonable early-bird discount. So if you don’t mind eating with the nannas, book your table for before 6pm.

Search the discounts: Websites like The Fork and LivingSocial will show you where the savings are. For example, close to me right now is a restaurant offering 30 per cent off the menu and one with a $49 three-course lunch special on.

Get onto the Entertainment: It used to be called the Entertainment Book, but now it’s an app. The savings are still huge, though, so if you enjoy eating out, a membership could save you money all year.

Find the rest of our Money Focus series here.