Automatic fuel excise adjustment couldn’t come at a worse time

In a recent adjustment that underscores the ongoing cost-of-living challenges, the Australian fuel excise has increased, pushing petrol prices higher once again. This change is part of the government's routine practice of adjusting the excise in line with the Consumer Price Index (CPI), a review that occurs biannually.

As of the latest review, the excise rate on fuel has risen from 48.8 cents per litre to 49.6 cents per litre. This means that it would cost you close to $40 to fill up an 80-litre tank in a large SUV. It's a small change that can have a big impact on your wallet, especially when you're trying to juggle other rising costs.

Compounding cost pressures

As the fuel excise increases, Australians are also contending with a rise in car insurance premiums. This double whammy exacerbates the financial strain many are experiencing, making it more challenging to navigate the current economic environment. It's like being caught between a rock and a hard place, with every cent counting more than ever.

Strategies to offset these rising costs

Given the dual increase in fuel and car insurance costs, finding ways to economise is more crucial than ever. Here are some strategies to consider:

Saving on fuel

Improving your fuel efficiency is a straightforward way to counteract rising fuel prices. Here are some practical tips:

• Drive efficiently. Smooth acceleration and braking can not only reduce your fuel consumption but also prolong the life of your car. Think of it as a double win for your pocket and your vehicle.
• Maintain your vehicle. Regular maintenance, including tyre checks, ensures your car runs optimally. It's like keeping your body healthy; a well-tuned car uses fuel more efficiently.
• Plan your trips. Combining errands into fewer trips saves fuel and time. It's all about being smart with your routes and timing, much like planning a mini road trip.
• Reduce drag. Remove unnecessary items and roof racks when not in use to improve aerodynamics. Think of your car as a swimmer - the sleeker the form, the less energy (or fuel) it needs to move.

Additionally, consider these longer-term strategies:

• Upgrade to a more fuel-efficient car. If it's within your means, switching to a vehicle with better fuel economy can offer significant savings over time. It's an investment in your future spending.
• Use public transport. Taking buses or trains for your commute can drastically cut your fuel costs. Plus, it's a great way to catch up on reading or podcasts.
• Carpool. Sharing rides with others can halve or even quarter your fuel expenses for the same journey. It's also a nice way to socialise and reduce your carbon footprint.

Saving on insurance

Car insurance premiums can vary widely, but there are several ways to ensure you're getting the best deal:

• Increase your excess. A higher excess can lower your premium, but ensure it's still affordable for you. It's about finding that sweet spot where you're comfortable with the risk and the cost.
• Seek out discounts. Many insurers offer various discounts; it's worth asking what's available. You might be surprised at what you qualify for, from loyalty discounts to savings for online applications.
• Review your coverage. Ensure you're not over-insured or paying for unnecessary extras. It's like decluttering your policy to make sure it fits your current needs.
• Choose wisely. The make and model of your car can significantly affect your insurance premiums. Cars that are cheaper to repair or have better safety ratings tend to have lower insurance costs. Think of it as choosing the right tool for the job.
• Maintain a good driving record. A clean driving record can qualify you for lower rates. Every driver's dream is to be seen as a lower risk, and this is one way to achieve it.
• Pay annually. If you can manage it, paying your premium in one go can often be cheaper than monthly instalments. It requires some budgeting, but the savings can be worth it.

These strategies can help you manage and even reduce your fuel and insurance costs, making your overall financial situation more manageable despite rising expenses. It's about being proactive and making small changes that can lead to big savings.