Lifestyle

The money wasters costing Aussies more than $5000 a year

Could you tighten up your budget to save cash?
Could you tighten up your budget to save cash? Barry Leddicoat

AUSSIE households are wasting more than $5000 per year on avoidable spending, including bank fees, credit card interest charges, ATM fees and wasted food.

The worst off are those who smoke or gamble, with households wasting on average $1734 a year on tobacco and $795 on gambling, according to analysis from comparison site mozo.com.au.

Inattention is also costing Australians, with each household spending about $653 a year on credit card interest, $511 on bank fees, $76 on ATM fees and $154 on traffic fines.

The nation's second biggest money waster was food, with Australians throwing out $8 billion worth of edible food every year, which comes to an average of $950 every year per home.

The cost of fruit and vegetables has risen by about 16 per cent each year and meat increased by approximately 10 per cent, resulting in skyrocketing grocery bills.

"Australians are hurting financially due to avoidable spending habits," Mozo director Kirsty Lamont said.

"To avoid unnecessary financial waste, take a good look at where your money is going.

"Review your purchasing habits, take note of food or clothing that you might discard and study your household bills. A few small changes can result in major savings."

Australians were also wasteful when it comes to clothing, as they are the second largest consumer of textiles in the world and throw out a whopping $500 million in clothing every year.

With stagnant income growth and many households feeling the strain of mounting debt, eliminating avoidable spending habits can make a difference.

"It always pays to compare credit cards to ensure you've got the best card for your spending habits, and if you can't pay it off, refinance and pay your debts," Ms Lamont said.

Banks will be abolishing ATM fees but it's still worth scrutinising what other fees you are paying and when.

Mozo also found the average household had the potential to save more than $380 a year on electricity.

Ms Lamont said staying on top of personal finances could result in simple savings for Australians.

TIPS TO REDUCE FINANCIAL WASTE:

• Review your bank account terms and conditions to assess where you could be charged unnecessary fees and compare credit cards to ensure you've got the best card for your spending habits.

• Take note of expiration dates in your fridge and move older food to the font of your fridge. If you do throw food out keep a list to avoid making the same mistake twice.

• Review your energy bill and consider where you can lower cost. Turn off appliances at the outlet when they're not in use, check appliance energy ratings and only heat/cool rooms that you are using.

• Take note of when gift cards expire and set a reminder in your calendar weeks prior to expiration.

Topics:  budget editors picks household money



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