Many Australians lose thousands of dollars each year without realizing it, but there is a quick and easy solution.
The term “lazy tax” refers to when someone pays more than they should for a service, such as insurance, home loan rates, mobile phone fees and mortgage lender costs.
By carefully switching providers or canceling subscriptions, Australians can inject cash into their wallets in as little as 60 minutes.
Sydney finance guru Queenie Tan swears by this tactic and has used it herself to save money.
“I personally review all my suppliers every year to make sure they are competitive and if not, I call them and negotiate a discount,” Queenie told FEMAIL.
Sydney finance guru Queenie Tan (pictured) described the lazy tax as “the price you pay for not reviewing your subscriptions to make sure they remain competitive”.
Queenie reviews all of her suppliers every year to make sure she and her fiancé Pablo Bizzini get the best deal (right).
‘Most of the time, they are happy to offer a discount, but sometimes you may have to change. But it’s honestly worth it!’
‘The laziness tax is the price you pay for not reviewing your subscriptions to ensure they remain competitive. “It’s a tax I’m sure we’ve all paid from time to time, but it’s good to be reminded so we can be aware of it,” Queenie continued.
The 27-year-old said insurance and electricity costs tend to be the biggest contributors, followed by mortgage interest rates and phone and internet bills.
‘Not having a competitive home loan can cost you much more in interest! For example, let’s say you have a $500,000 mortgage with a six percent interest rate, just a one percent increase in the interest rate could cost an additional $312 per month in interest. So it really surprises you!’ Queenie said.
So far this year, Queenie has saved $600 on her car insurance by switching providers.
‘I also switched my electricity to a new provider and switched it based on time of use (so there are different rates for off-peak and peak times) and since I have an electric vehicle, I saved about $100 a month on my electricity bill. ‘ she said.
“I also changed my internet service earlier this year and saved another $10 a month.”
With the extra money saved, Queenie likes to split it equally by spending half and investing the rest.
“I love investing because it’s a great way to build wealth and it allows us to give ourselves more options about what we can do with that money in the future,” he added.
Insurance and electricity costs tend to be the biggest contributors, followed by mortgage interest rates, high-interest savings accounts, and phone and internet bills.
On Reddit, several Australians admitted they wish they knew about lazy taxes sooner (stock image)
Several Australians admitted they wish they knew about lazy taxes sooner.
One person said they had managed to save $3,200 a year simply by switching providers or requesting discounts.
‘I just looked at all this after paying the lazy tax for too long. “Two cars, house and contents, electricity and Internet, and I make about 3.2 thousand dollars a year if I find better options,” the Redditor wrote.
‘They also deducted 0.64 percent of the home interest rate with a quick call. All with a little time to compare at lunchtime and a few phone calls.’
Another Redditor estimates he saves approximately $1,020 each year by switching plans, canceling subscriptions, and using rewards systems including Woolworths Rewards and Shopback.
A third added that it is often easier to move to a better-paying job than to wait for a promotion.
‘Another place I consider lazy taxation is your job. “Some people just put off moving to a higher-paying employer because they feel comfortable and the thought of updating resumes and going to interviews is a hassle, but you can often do better if you move and put in the effort,” they wrote.
“A lot of people will read this and say yeah, good idea, and then forget about it again.”