5 of our favourite ways that we save money

By | May 21, 2017

Author: Mr & Mrs DDU.

Accommodation – living in the 70s

Where people live is usually their biggest expense. At the moment, we are spending around 20% of our annual income on rent. All Australians can understand that finding good value accommodation is very difficult.

We live on the edge of our city, in a place that was built in the 70s and still has lots of the wonderful features such as orange carpets, an orange kitchen bench and lovely yellow glass. It doesn’t have air conditioning (not fun in the Australian summer) and the kitchen is tiny.

We can afford a better, more modern place that’s closer to the city, but we live near the train station and the combination of compromises means we are saving literally thousands of dollars every year.

Transport – 1 car family

Cars are expensive. The petrol, registration and insurance alone annually would probably cost Mr DDU double what his annual public transport fee costs to use the train to get to work. But of course, the biggest expense is the deprecation of the car – even if we were to buy with cash, if we bought with a loan it would be even worse.

We plan on only having 1 car for the rest of lives, which saves us several car purchases over our lifetimes.

By only having 1 car and Mr DDU using public transport to get to work, we are saving thousands every year.

Food – Aldi

There is more to food than just how much it costs of course. FIRE shouldn’t influence anyone to eat like a college student just having ramen noodles or baked beans on toast every day. We want to eat healthily and we want good quality food for good value.

Australia is dominated by 2 large supermarket chains: Coles and Woolworths. A few years ago they had the biggest profit margins of any supermarket chain in the world. Australians didn’t really have much of a choice, the local supermarket was always a Coles or a Woolworths.

To us, it doesn’t matter if it’s a branded product or not. A brand just means it has more profit built into the price. If it’s a third cheaper at Aldi, just as good quality and (usually) made in Australia then that’s great for us and our budget. It’s just a piece of chicken, an apple or block of cheese. What’s the difference? What’s not to love?

Although Coles and Woolworths have reduced their prices recently, we still probably save at least 20% on each shop/item we buy at Aldi. If we had to briefly sum up a few tips on how we save on food shopping it would be:

  • Make a weekly meal plan & shopping list before going shopping. Stick to only what’s on the list. Those extra little purchases cost our budget, and are exactly what the supermarket wants.
  • Do 1 weekly shop. We save ourselves so much time and probably money too; there are less opportunities to pick up more random items.
  • Buy as much as we can from Aldi, it’s nearly always the cheapest. Buy any extras needed from Coles/Woolworths/IGA.

Entertainment

People like to spend a lot of money on one fleeting experience then look for the next one. Don’t get us wrong, we want to spend a lot of our money on fun things and travelling once we reach Financial Independence, but we want to save as much money as we can until we get there.

We like to do a lot of things that don’t really cost us much, if anything. We like to go on walks on the beach (free), watch recorded movies from the TV (free ( apparently it’s an Australian thing)), go on road trips (only cost is petrol), play our Xbox together with games we already own (free).

We do spend money sometimes but we’re making a conscious choice to mostly do inexpensive things and funnel our money into saving and investing instead.

Shopping

Like we mentioned with food, brands don’t really mean much to us, as long as the product is pretty good quality and good value.

We will happily buy things from Aldi, Best & Less, Kmart, IKEA, 2nd hand from Facebook groups etc. before looking at more expensive options if we can’t find what we’re looking for.

A hoodie, plates, a torch, baby things. Those are all things we’ve bought in the last 2 or 3 weeks from one of the above shops and they’re great quality. Products from more expensive shops are also good, but we’re trying to be bargain hunters at this point in our lives, Mrs DDU is awesome at finding us the best possible bargain.

Final thoughts

All of the above choices probably save us at least around $7,500 to $10,000 a year, which can compound into big dollars over the years and decades ahead.

Our lives could probably be a little more comfortable (eg renting a house with air conditioning or a dishwasher) if we spent more, but we’re not missing out on much. The only thing we want is perhaps a portable air conditioner so our baby doesn’t have to suffer in 40C+ days.

What are some of the choices you make to save money?

Thanks for reading this article about our finance journey Down Under.

Onwards and upwards!

34 thoughts on “5 of our favourite ways that we save money

  1. Passivecanadianincome

    Cricky! Good list. Big sacrifices no ac? Haha no way.we are in the process of cutting cable so that’s one way we cut. Also buy cheap clothes vs brand names now. And groceries from cheaper places and price match. Walmart has good groceries and we are thinking of ordering online and just picking up the stuff. They pack it all and it’s free this way we won’t get any distraction add ons. Haha

    Reply
    1. Dividends Down Under Post author

      Thanks PCI 🙂
      That is a good idea to utilise an online ordering service for your groceries, avoid those temptations like you said, especially if it’s free!

      Mrs DDU

      Reply
  2. Dividend Diplomats

    DDU –

    I think you hit it on the head with covering shelter, transportation & food. My favorite is the entertainment piece. Usually we like to have people over or go over someone else’s house – bringing in a snack we have made and/or a drink of our choice. By FAR cheaper than going out somewhere, or eating out. Also – it’s more fun, intimate and you get to control what you drink, eat and spend : )

    -Lanny

    Reply
    1. Dividends Down Under Post author

      Sounds like you enjoy a good dinner party or two Lanny! It is often a nicer atmosphere when having get-togethers to be at someones house vs a restaurant. I don’t think we are quite at the stage to host get-togethers though with our tiny rental – the trade-offs for saving money eh? We don’t even have enough room to sit 4 people around a table!

      Maybe in our next house we will feel more confident being the hosts – until then we very much enjoy being the guests 🙂

      Mrs DDU

      Reply
  3. FerdiS

    All the ways you’re saving make lots of sense, but I would draw the line at trying to live without an A/C in 40 degrees Celcius temperatures. Spare yourselves the misery and buy the portable A/C!

    Happy saving and investing!

    Reply
    1. Dividends Down Under Post author

      Thanks for commenting :).

      Haha yes, we are starting to agree with you there after putting up with 3 summers so far without AC. Next summer it is a tentative plan to get a portable unit.. and eventually, in our next house, the luxury of an AC is almost a requirement!

      Mrs DDU

      Reply
  4. Martin - Get FIRE'd asap

    We follow many of the same examples you list to keep expenses down (except having 2 cars). Re the shopping ones, that’s exactly what we do. Plan a weekly menu, write a list covering only what food items we need, and do the majority of our shop at Aldi. I agree that this saves us at least 20% on our grocery bill each week. Our weekly bill would be around $85 for two adults.

    I read with interest the comments about not having ac. We do have ac which is considered a must living in Queensland. However, it would have been used, maybe 3 times, in the last summer. We open windows and sliders and keep the place ventilated. Also, by naturally adapting to the temperature we just feel the effects less even when it does hit 40C. The only time we used it is when the humidity became unbearable.

    I say if you can do without the ac, whether by choice or not, good on you. Our neighbour’s ac was running 24 hours a day during summer. Their power bill must have been huge.

    Reply
    1. Dividends Down Under Post author

      Thanks for commenting Martin.

      The AC – we do try to take advantage of ventilating the house, shading our bedroom window with a make-shift shadecloth that we put up every year.. things like that.. but I guess at the end of the day this house just isn’t built for the heat. If we owned the place installing some quality insulation in the roof would be a MUST, we would also put canvas retractable awnings on all the main windows. One of the biggest problems is that the windows are wind-out (so not much air actually gets in) and the large windows of the house face the hot sun in the morning (kitchen, bedroom) in the morning and living room in the afternoon.

      We will more than likely get a portable unit for the hottest days for next summer – but I’ve avoided it because our windows are not portable-unit friendly being the wind-out type.. So I’m really not sure how we will vent the exhaust without damaging/modifying the window.. I love renting (affordable, no maintenance costs..), but I also hate it sometimes!

      Mrs DDU

      Reply
  5. Wealth From Thirty

    Props to you guys. That’s awesome you’ve really got your savings in those big areas. I’m surprised “hoodie” is an internationally recognised term(!) haha.

    Keep it up!

    Reply
    1. Dividends Down Under Post author

      Is “hoodie” an international recognised term? We have no idea! But it just seems so normal to our Australian vocab that we didn’t even think about it haha.

      Mrs DDU

      Reply
  6. Amanda @ centsiblyrich

    This is a great list! And great savings. We could definitely be saving more on housing and transportation…and are looking at the options of downgrading both after the kids are out on there own in approximately 4 years or so.

    I think it’s great you guys have been able to make it work without the a/c, but I can definitely see how a portable unit is something you want for the baby.

    Reply
    1. Dividends Down Under Post author

      Thanks for coming by Amanda
      Ironically, our housing (and maybe transport too) will have an increase in costs as we get into family life and want certain “luxuries” from our home life, guess things just change depending on life stages.

      Mrs DDU

      Reply
  7. Jax

    I wish I could get Mr. BL on board with no AC! He spends more time at home than I do, so it’s something I’ve let go of. I do suggest opening the house back up when the overnight lows are reasonable and he goes along with that!

    Reply
    1. Dividends Down Under Post author

      There is no way we would choose to not own an AC long term! For us it’s a temporary thing to save money as renters (rentals with AC come at a premium around here). Eventually having AC is a luxury we definitely want! Even if we only use it a few days a year – it’ll turn those days from misery into bearable. Using canvas awnings, insulation, etc would definitely be the first measures – even though we want an AC we don’t want to have the energy costs of having it constantly running!

      Glad you can get him onboard with opening the house to cool down – it’s so nice to have fresh air in the house at any time of year.

      Mrs DDU

      Reply
  8. Bella

    For us in Melbourne it’s the opposite. It would cost my partner $10 a day to catch public transport and it adds an extra hour to her overall commute. Driving her paid-off car however costs cents a day, certainly not $10 when we factor in rego and insurance. We have to have that second car at this stage in our lives (kids with grandparents far apart force us to) and it might as well be driven.

    I have a similar commute problem with public transport taking twice as long and costing $5 a day. I got around it by buying a motorcycle and cruising through traffic!

    Reply
    1. Dividends Down Under Post author

      Hi Bella, thanks for coming by our blog (I have popped yours on our “to check out” list 🙂 ).

      I guess it just depends where the public transport is located vs where you live vs where you work – some people it works out better for time (avoiding peak hour traffic) and others the public transport takes you on a very indirect route.

      Don’t forget that the original purchase of the car does need to be taken into account, one day you guys will have to pay to replace the car, even if it lasts a long time. I think the annual pass is about $6 a day for Mr DDU – we do save a bit by buying it annually :).

      At the end of the day it’s all lifestyle choices – we all splurge and save in areas that work for us as individuals – there is no “one size fits all” for life choices! Looking forward to checking out your site.

      Mrs DDU

      Reply
  9. pia

    Can’t live without the AC. We do have solar, but are quickly learning that without the government incentives, what we earn from Solar is pretty terrible. Time to save up for a battery!

    It’s hard when it comes to grocery shopping. Being in SA, there is a huge love for our local food industry and I am always a strong believer of supporting our little boutique producers which tends to attract a slightly higher price (and a more quality product) compared to the big supermarket chains and their constant price wars. So while we can obtain fresh vegs at very attractive prices, things like cheese and pickles attract a premium. I guess it’s a matter of balancing!

    Reply
    1. Dividends Down Under Post author

      Thanks for commenting Pia – great to see some Aussies getting in amongst the comment section!

      I am always tempted to buy from fruit and veggie shops but it just is a hassle at this stage because they aren’t very conveniently located, I have to admit that I’m a bit of a “one stop shop” fan and often do our food shopping at night, a big factor that the little shops can’t compete with. Maybe one day I’ll live near the holy-grail of shopping – an Aldi, Coles and a fantastic fruit shop (maybe even a butcher!?) in a beautifully close location sharing the same car-park. A girl can dream!

      Mrs DDU

      Reply
  10. J @ Hey, It's Just Money!

    We are similar in many ways. We also don’t spend a lot of money in entertainment. We like driving around, but petrol is probably the most expensive part of it. We rarely eat out when we drive, if we do, it’s only for a snack. We also only watch the movies when we have free or cheap tickets. Haha! Instead of Aldi, we buy most of our food from the markets. We don’t have a big freezer, so we only buy what we’ll eat during the week. We also buy our toiletries and other non-perishable from Costco.

    Great stuff, guys!

    Reply
    1. Dividends Down Under Post author

      Loving seeing your face pop up in the comments J 🙂

      I’m quite curious about Costco, but I’m not sure we would go often enough to make the membership worth it – I just wanna go to check it out for a bit of fun really.
      Oh something we started doing recently was hiring movies from Hoyts movie kiosks occasionally – $3.99 for new release stuff, we think it’s pretty good considering we don’t have Netflix (yet haha).

      Mrs DDU

      Reply
  11. Buy, Hold Long

    Saving that money now could mean massive returns in the future for you and your future baby. Congrats on the savings. There is apparently an Aldi coming close to where I live in rural SA so I am very pleased. Otherwise we just have Woolworths. No competition at all.

    Reply
    1. Dividends Down Under Post author

      We are definitely hoping that the savings compound into some great returns and tangible financial comfort as we get older (not having to worry about money is so good!).

      I’m excited to hear what you think of Aldi once it arrives! I bet Woolworths milks those margins by not having competition.. not even a Coles. I hope the Aldi hurries up even for the sake of getting some better value even at Woolies.

      Mrs DDU

      Reply
  12. Investing Novice !

    OOOoohhh. I always love a post about how to save money. Definitely have done everything you guys have outlined here in this post even with the AC, I just sweat it out in the summer just simply because I don’t want to pay the extra money for electricity haha. Thx for you guys 2 cents !

    One question I have is when you guys buy shares for e.g. with 500 dollars. One share priced at 70 dollars vs one priced at 5 dollars per share. If your goal is to have max dividend income doesn’t it make more sense to buy the 5 dollar share price more often as you get more shares relative to the other since dividends are payed PER SHARE for 500 dollars each time and if shares, on average, increase in price each year doesn’t that 500 dollars’ purchasing power (in terms of number of shares bought) gets less and less? This unanswered question which I cant find much info on really makes me hesitate to understand how its possible to generate that 40k/yr dividend income. What is the reason?

    Anyways, just wanted to say THANK YOU SO MUCH for you blog as it’s rare to find a Australian dividend investing blog as down to earth and informative as yours which gives greater hope for an “average” Joe to see the potential of dividend investing. Really appreciate it.

    All the best, D

    Reply
    1. Dividends Down Under Post author

      Thank you so much! We are so glad you came by our blog and commented, and what a lovely complimentary comment it was :).

      I hope my example on dividends will make sense – If you buy 1 $100 share, with a 5% dividend yield you would get a $5 total annual dividend. If you buy 100 $1 shares, with a 5% yield you still get a $5 total annual dividend. If you buy 10 $10 shares with a 5% yield you get that $5 total annual dividend again.

      The key is the “dividend yield”, which is a handy calculation that makes any share price comparable, would be way too hard to figure out which companies would have better dividends if there wasn’t a calculation which gave an equal comparison!

      Thank you again for your comment, hope to see you in the comment section again sometime 🙂

      Mrs DDU

      Reply
  13. Dividend Daze

    All great ways and that pretty much sums up the big categories for everyone. That is a substantial amount you can potentially save per year. Nice having that much extra capital you can use for investing and work for you.

    Reply
    1. Dividends Down Under Post author

      Thank you DD. It’s so ingrained in us to live this way that sometimes it shocks us how little money some other people have – it definitely makes a big difference to how much we can invest.

      Mrs DDU

      Reply
  14. Jen Forest

    We don’t have air-conditioning either and in an Aussie summer that can be pretty tough. But frankly you’ve got to weigh up how many days are actually 40C and how much it will cost. Plus there are plenty of places to hang out with airconditioning – like work, the local library, museums….

    Reply
    1. Dividends Down Under Post author

      Another Aussie pushing through the heat! I’m very thankful that I’m not heavily pregnant in the summer at least, that would be a struggle I’m sure.

      Mrs DDU

      Reply
  15. Undergrad Investing

    Still trying to convince my girlfriend to let us start shopping at Aldi. I wonder how it got such a bad rap. Great list though, with some handy hints

    Reply
    1. Dividends Down Under Post author

      The first time we shopped at Aldi we were not fans, it took us awhile to get up the desire to try again – was definitely worth it! I hope you can eventually get her round to being an Aldi fan, maybe take her in for an especially good week of “special buys” and she might just get hooked!

      Mrs DDU

      Reply
  16. Joe

    It’s nice to see someone making the same choices I have, including the 70s housing and shopping at Aldi!

    One thing I’d recommend, if you can do it, is convert your car to LPG. FIlling up only for $30 every fortnight (instead of $80) pays for itself pretty quickly.

    Reply
    1. Dividends Down Under Post author

      Hi Joe, thanks for coming by our blog! we should start a 70s home living club! compare our horrible decor haha.

      Great tip about converting the car to LPG – it would really save on the costs for people who drive a lot. We hardly drive at all, with Mr DDU commuting by public transport and I work from home. So the car is usually about $40 a fortnight for us, probably not worth the hassle of converting to LPG considering how little we drive. But is definitely one of those little gems of “hacking” that can save a lot of money in the right situation – sounds like you’ve got a great frugal mind 🙂

      Mrs DDU

      Reply
  17. Kathleen

    Aldi has made such a difference in our grocery bill, even for just the two of us. And I find because there is less to choose from I am done with the grocery shopping in record time, rather than browsing every single isle.

    Reply
    1. Dividends Down Under Post author

      Thanks for commenting Kathleen :).

      You’re right that one of the perks of Aldi is how fast it is to get around the whole store – used to walk around Coles for at least an hour back in the day. Now we are in and out of Aldi in 30 mins. Love it.

      Mrs DDU

      Reply

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