When Mark and Christabel Harris made the decision to switch home loans, they took a big, positive step forwards when it came to their savings. In fact, after the switch, they were $1000 a month better off! And yet it’s a step that many Australians still think is not worth the effort.
These days, we are quite literally bombarded with advertising that tells us we can save, save, save. Especially at this time of year when the Christmas fever sets in! Yes, most of us really do want to save and find ways to be savvier with our money. We feel great when we’ve found a great deal on clothing or found a way to save a few dollars on our weekly groceries. And sites like Scoupon are more popular than ever. But, as the saying goes, are we being ‘penny wise’ and ‘pound foolish’? Are we sweating the small stuff, and ignoring those areas where we could make a huge difference to our savings?
Well, according to a new study, when it comes to shopping around to save money, it appears we are a nation of misguided misers.
At Heritage, we were interested to find out about the approach Aussie families take to finding a better deal, and why. To shed some light on the topic, we teamed up with the University of Technology Sydney to carry out an Australia-wide study on switching.
The results showed that we are a nation of that doesn't let go of our money easily, with 76% of people looking to limit their spending and hunt out the best deals.
However, it showed we’re putting our energy into saving in the wrong places.
We’re missing out on an estimated $7.4 billion a year by focusing on minor purchases, such as our weekly shop, rather than major life purchases, such as a home loan.
It seems that Aussies crave the instant gratification we get from saving a few dollars shopping around for food and fashion, but we’re ignoring the potential to save thousands by doing the same on major purchases.
The study found that there was a trend toward Aussies wanting to be savvier with their money.
But it was interesting to see that those who consider themselves 'tightwads', who are typically very rational with their spending, tended to look for savings on the things they connect with emotionally, like clothing and travel.
Almost a third of Australians think switching home loans is too much trouble, making it the primary barrier to finding the best deal. A further 28% considered the cost of switching not worth the time and effort.
The reality was that savvy switchers who did take the plunge and switched their home loan provider reaped the benefits, saving up to $2,800 per year*.
Sound impossible? Check out some of our happy customers who are, in some cases, saving at least this on one mortgage alone in their first year since having switched over to Heritage .
In fact, despite people thinking that the perceived cost of switching wasn’t worth the time and effort, the report showed Aussies saved $3 billion by switching providers for their home loan, credit card and energy suppliers.