Five tips to combat rising transport costs
After nearly two years of COVID-induced inactivity, soaring transport costs have provided an unexpected headache for drivers and commuters getting out and about once again, adding to the overall cost of living pressure being felt by many Australians.
Unsurprisingly for anyone who's filled up at a petrol station over the past few months, the cost of fuel has been one of the main sources of price pain for motorists. In fact, a significant rise in automotive fuel prices (up 11% over the quarter) helped drive the latest Consumer Price Index up to 5.1%.
On top of fuel, car loan repayments, tolls, public transport, car servicing, insurance and registration have also helped lift the average household's transport outlay to $19,147 a year according to the AAA's Transport Affordability Index.
"The latest edition of the AAA Transport Affordability Index shows average weekly household transport costs in capital city households is now $401.05 a week and $330.67 a week in regional areas," says AAA managing director, Michael Bradley.
"The latest results include the impact of global price shocks flowing from the war in Ukraine, and changing vehicle purchase patterns, which in turn impact car repayments. Rising fuel prices continue to be a significant contributor to cost of living pressures across both regional and metropolitan Australia."
So with transport costs at some of the highest levels they've been in years, here are some simple ways for households to trim their expenses.
Get fuel savvy
Fuel price websites and apps are one place to start for those looking to narrow in on the cheapest petrol stations in their area. As Susan Furze, head of public policy at RACQ says, the cheapest petrol station might not always be the closest, but it could make a significant difference to the price you pay at the bowser.
"RACQ research shows convenience is the main reason drivers pull into a particular service station. However, there can be up to 40 cents difference between the cheapest and most expensive sites, which is why it's so important to use apps such as RACQ's Fair Fuel Finder to do your research before heading to the bowser."
Just as important as comparing where to fill up is working out when to fill up. Rather than aiming to top up your tank on a certain day of the week though, if you live in a capital city it's worth keeping tabs on the cycle of petrol prices which are tracked by the ACCC. That way you can try and be strategic about when you fill up.
Interested in some more petrol-saving tips? Here are six ways to save money on fuel.
Revise your toll use
According to the AAA, tolls are the third largest contributor to household transport costs behind car loan repayments and petrol for drivers in Brisbane, Melbourne and Sydney.
"The average Sydney motorist is paying nearly $90 a week in tolls - it's huge," says NRMA spokesperson Peter Khoury. "By contrast, the second most expensive city is Melbourne with motorists paying about $55 a week on average."
The best way to reduce the amount of money you're paying to use toll roads is to not use them at all or, at the very least, reassess the cost to convenience benefit of using them. Of course, that's not going to be an option for many drivers who can't easily do their daily commute without using toll roads, so for those in that situation, it's worth looking at any rebate schemes or toll relief available.
For example, residents in New South Wales who spend over $1,462 a year ($28 a week on average) on tolls are eligible for free car registration, while those who spend at least $877 a year ($17 a week on average) can get half-price registration. NSW residents who use the M5 motorway in Sydney can also claim back the value of at least some of their tolls through the M5 South-West Cashback Scheme.
Swap your drive for public transport
Given the current price of petrol and all the other costs associated with running and maintaining a car, making use of trains, buses, ferries, and light rail could certainly help cut down your transport costs. That is, if you live in an area where they're available.
"People often look towards public transport as a cheaper alternative and it most certainly is, but there's a disconnect in that a lot of families in outer-suburban and regional areas don't have access to reliable services," says Khoury.
If you are happy and able to use public transport though, being flexible with your travel times can help you save even more because many cities offer discounted fares for off-peak travel. For example, fares in Brisbane are 20% cheaper for people who travel between 8.30am-3.30pm and 7pm-6am on weekdays, and all day on weekends. And in Sydney, fares are 30% lower when you travel outside of peak times.
Reassess your car insurance
With drivers in major cities paying an average of $1,580 per year and those in regional areas paying $1,274 a year according to AAA data, car insurance isn't an insignificant expense. It is a cost that, depending on your existing insurer and policy, you may be able to trim though.
One of the easiest ways to potentially save is by shopping around and comparing options from other insurers each year before your own policy is due for renewal. After all, if you can get a better deal with a policy that's roughly equivalent to your existing one then why not make the switch?
If you are shopping around, consider purchasing your policy through an insurers' website because many offer online discounts of around 10-15% off the first-year premium price. And if you're able to, it may also be worth paying your premium annually rather than monthly in order to take advantage of the annual discounts some insurers provide.
Looking for a competitive price on your car insurance? Check out the winners of Money Magazine's Best-Value Car Insurance for 2022.
Ditch the commute altogether
Now the ultimate way to cut down on your transport costs - at least, the expenses you occur to commute to and from work - is to work from home if your employer allows it. That may seem obvious, but a look at the numbers truly drives home the potential savings on offer.
In a recent analysis, Compare the Market found that a commuter based in Brisbane would be able to save over $250 a week on average by eliminating the cost of fuel, tolls and parking in the CBD and, instead, working from home. Likewise, a commuter travelling during peak times would be able to save $41 a week by forgoing the cost of public transport.
And that's just the figures for transport costs. It doesn't factor in the other potential savings that come from working at home, nor the extra time saved by not having to commute.
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