Humans are creatures of habit. We like things to be predictable. Of course there’s excitement that comes with a bit of the unknown. Like when we fall in love, go travelling or start a new job. But ultimately even those situations end up becoming familiar and we can often predict what the next step will be moving forward.
If you took a moment to peer at your various bank statements it would be clear that you are indeed Habitual Homosapiens, your finances reflecting your propensity for patterns. The same cafes account for roughly the same expenditure each week as does the weekly spend at the same supermarkets. Gym memberships, magazine subscriptions, streaming services and all the other routine bits and pieces we spend our money on reveal much about our habits. Our spending also indicates what we value and what we prioritise.
Healthy habits can keep us well, active and stress-free and of course unhealthy habits can do the opposite
Spending habits can also either be healthy or not so healthy. Mindful, healthy spending can see us investing in good quality items, keeping our credit card for emergencies and ultimately ensuring income is managed carefully. Unhealthy spending habits sees us splurging on small but regular impulse buys and big ticket items even without the cash flow thanks to a tendency to reach for the credit card when inspiration strikes.
Our habits are often reinforced by systems already in place. We tend to stick with what we know because it’s easier. The same insurers, the same electricity providers, the same mobile phone and internet providers. They bill us monthly or annually and we pay the bill because if we don’t we’ll be in trouble and we couldn’t be bothered to research an alternative. It seems like hard work investigating and sometimes there’s not a whole lot of difference between the options anyway (or so we tell ourselves). But sometimes there is. And it’s the small difference in the short term which can lead to big difference in the long term.
$5 off your monthly phone bill, combined with $40 off your quarterly electricity bill, combined with brewing your own coffee instead of buying a daily cup, ending the subscription for that magazine that you never read anyway, cancelling the gym membership because you only use the treadmill and well, you could just go for a walk instead… All these itty bitty reductions could take hundreds off your monthly expenses. That’s money you could put towards your mortgage, a holiday or a new kitchen.
When was the last time you compared your health insurance, electricity or gas, or tried shopping for your groceries elsewhere?
Habits can be hard to dislodge, and once established become harder to break as they occur on a subconscious level. Routine expenditure is even harder to limit when automatically debited from our accounts. The highly popular ‘set and forget’ subscription model is favoured by many businesses these days because they benefit from our busy distracted minds.
As health funds launch their yearly campaigns targeting 31 year olds (to avoid Lifetime Health Cover Loading) the rest of us can benefit as the funds compete with their best value offers. Health cover is an example of a routine spend you should reassess every few years. Do you need cover for cataracts and knee surgery at age 40? Do you need maternity hospital cover at age 50? Oftentimes we want the ‘very best’ we can get in the interests of looking after our health and wellbeing but end up taking up more cover than we actually need or will ever use.
There are options to customise cover to suit your own individual needs and these needs will change over time so are well worth reviewing every few years. Perhaps you don’t get nearly enough value from your cover and it's time to drop it all together. You could funnel what you were paying in health fund fees into a dedicated ‘health and wellbeing’ account ensuring you always have ample funds to reach for if a medical emergency arises. Every one of us has a unique health situation and so no cookie cutter health fund package is going to necessarily suit our individual needs.
Looking at your expenditure with fresh eyes may result in more money at your disposal. As you go through your yearly expenses in preparation for your tax return take some time to review your accounts and check to see which small and large expenses could be reduced or even eliminated. They say change is as good as a holiday. What if these changes PAID for your holiday too?
Taking the easy (often automated) route is rarely the most rewarding. As one of my favourite quotes goes “if you always do what you’ve always done, you’ll always get what you’ve always got”. And who knows what wonderful opportunities (and savings) are waiting for you when you step off the well worn path of direct debits and head off in a direction dictated by your own desires instead?
Alison Gallagher is a freelance writer, resourcefulness expert and entrepreneur. She has been featured in various publications including Stellar Magazine, Australian Health and Fitness Magazine, and Cleo Magazine. Alison is particularly passionate about sharing practical tips on how to live simply, sustainably and seasonally.