We've all heard plenty of horror stories about share houses, but those of us living with lively flatmates or engaging family members should consider ourselves lucky. Yes, we have to groove to some questionable music or deal with occasional dirty dishes, but we also get to share household expenses, groceries, energy bills and streaming services. In 2023, that’s a major win.
As of December 2022, Finder’s Cost of Living Report showed households were paying 7.8 per cent more for goods and services compared to the same period in 2021. We’re all feeling the pinch, particularly those of us shouldering the household bills on one income.
More Australians than ever are living alone, which reflects the evolving dynamics of our society. We’re delaying marriage, getting more divorces, living longer and having fewer children than previous generations. In fact, the average number of people per household has dipped to 2.5 in 2021, according to Census data, while the number of lone households has risen to 25.6 per cent.
Why it costs more to live by yourself.
Behavioural economist Dr Meg Elkins from RMIT University says paying your mortgage or rent, utility bills, insurance and groceries is no mean feat when prices are rising and there’s no second income to help cover the difference.
According to Home Loan Experts, average living expenses for a couple in Australia amount to $4,118 per month, or $2,059 per person, while the living cost for one person is $2,835 – a whopping $776 difference.
At the same time, government tax benefits tend to favour larger households, Meg explains.
‘As median voters, families tend to get more subsidies and rebates while lone households can often feel on the outer.’
Some singles might consider boosting their income with a second job, but that’s not a viable option for everyone, Meg says. For those relying on themselves, it's time to get smarter.
How to save money when living alone.
There are a few ways Meg suggests lone householders can save some coin and boost their coffers.
1. Get smart with what you pay for.
Go through your bank statement and cut out products and services you don't need. Be harsh: we're talking streaming services, cafe brunches and those irresistible new shoes.
‘Working out what your priorities are in order to achieve the lifestyle you want might mean giving up things that you've done regularly,’ Meg says.
2. Refuse loyalty tax or 'lazy' tax.
This is the higher rate or fees companies charge long-term customers as opposed to the new people they're trying to entice.
Don't stand for it, Meg says.
‘If you get a bill that says ‘our prices are rising in line with CPI’, then the company may just be taking advantage of inflation,’ she says. ‘This is an opportunity for you to shop around. And the more that you do so, the more it pushes back on companies not to profiteer.’
You may want to compare energy providers first up to check you're getting the best deal. And find out what energy rebates are available in your state or territory.
3. Get savvy with meals.
Grocery shopping for one can be expensive. Try to be more strategic with your shopping and only buy what you need, plan your meals around what's on special or in season, and take advantage of supermarket reward programs.
It's also worth seeing what initiatives are happening in your area to reduce food waste, Meg suggests.
‘Shop at the end of the day for reduced items or go to restaurants at closing time to see what they've got available.’
4. Join the sharing economy.
Living alone doesn't mean you can't pitch in with others. Back in the 1950s, if someone got a vacuum cleaner, the whole community would share it.
‘Neighbours can come together in the way of community gardening, producing their own foods, swapping meals or bulk-buying food together from a wholesaler,’ Meg says.
Sharing doesn't only extend to being at home; consider going on holiday with other people instead of forking out for a single room.
5. Stash your money.
Make it a rule to prioritise your savings and stash any money you set aside in a high-performing short-term savings account where the interest rate is actually working in your favour, Meg suggests.
You may have to make some tough decisions.
If your household bills are starting to weigh on a single income, it might be the perfect time to review your situation and consider alternatives like shared accommodation, communal living or moving in with family, even temporarily.
And if you’re not ready to make a change like this just yet, there are still plenty of ways to get creative with cost-cutting.
Take control of your household expenses with SpendME.
From tracking your bills and daily spend, to stashing your savings, ME has got you covered.
Find out more
This article is prepared based on general information. It does not take into account individual financial objectives or needs and is not financial product advice.