Energy is one of our biggest expenses, right? Well, actually, you might be surprised. It isn’t.
Australian Bureau of Statistics data shows that electricity sits at 13th on the shopping list of what we spend our money on.
What were the 12 things above it?
Buying a home and renting a home sat at No 1 and No 2, with other financial services coming in next. Then, in order, it was medical/hospital costs, restaurant meals, automotive fuel, overseas holidays, tobacco, domestic holidays, motor vehicles, takeaway/fast food, telecoms.
Then, in 13th spot, electricity. Gas doesn’t even rate a mention in the top 20.
The rest of the list is rounded out with home maintenance, vehicle maintenance, beer, wine, secondary education, tertiary education and property rates/charges.
Tobacco, electricity and gas were our fastest rising costs, but our lifestyles ate up a huge chunk of our income.
When energy goes up, it cuts into the discretionary spending that most people consider a “right”. Smashed avocado, anybody? Another latte? Another beer? Nobody really wants to give these up to pay the bills.
There was a time when people lived more simply, ate more simply, bought less, travelled less, saved. But frugal has become a bit of a dirty word. There was a report recently in which millenials who didn’t want to eat out for every meal, buy multiple coffees a day and spend weekends partying were being, effectively, bullied. Why? They said eating out was the prime socialising time for their peer group and by declining they were seen as anti-social. It was tough, being shunned, but they couldn’t see the point in spending $20 a day on lunch, when a $3 one from home would do.
They were onto something. Eating out, takeaways and smoking were high-spend areas in the ABS data, with drinking in the next tier. So by cutting back, these savvy 20 and 30-somethings were putting aside money for house deposits, early retirements and travel.
And to easily pay the energy bills with which we are all so pre-occupied.
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