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Money mistake costing Aussies $1,140

Aussies are paying a ‘loyalty tax’ and it’s costing us thousands each year.

Young people walking through city in Australia. Australian money notes.
Aussie households are missing out on $1,140 per year in savings by making this mistake. (Source: Getty)

Half of Aussies are making this simple money mistake and it could be costing them thousands each year.

New research by iSelect found Aussies could save an extra $1,140 each year by switching their household expenses, including electricity, gas and insurance.

Despite this, more than half of Aussie households surveyed admitted they hadn’t changed any of their household products or services in the past 12 months.

iSelect spokesperson Sophie Ryan said Aussies were paying a ‘loyalty tax’ by sticking with the same providers and missing out on thousands in savings.

“We understand that life is busy but, in the current economic climate, every dollar counts, and any lost savings found are arguably even more valuable than ever,” Ryan said.

Aussies who switched their electricity in the past 12 months pocketed an extra $394 on average, the survey of 2,000 households found, while those who changed their gas saved $279.

There were also savings to be had for switching insurances, including health insurance - with $520 saved on average - car insurance - with $331 saved - home and contents insurance - with $337 saved - and pet insurance - with $416 saved.

In total, iSelect found Aussie saved a whopping $3.9 billion by switching providers and/or plans in the past 12 months.

How to find your lost savings

It’s important to review your plans and policies regularly, iSelect said. Your needs and circumstances can change over time and it’s worth checking you aren’t paying for things you don’t need, and not covered for the things you do.

Next, shop around and see what deals are being offered to new customers. According to iSelect, Aussies are losing $18.7 billion in savings annually by remaining loyal to the same providers and plans.

Lastly, the comparison service said to look at other ways you could save. For instance, some insurers may give you a discount if you opt for a higher excess.

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