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  • Mitchell Johnston

Two hours work for a weeks income

Updated: Sep 25, 2018


It’s an urgent job, we need it done right away, you’ll only need to stay back an hour, maybe two tops. We’ve all heard this from an employer before. Most conform to the request, often begrudgingly, however it’s just part of being a grown up and having a job.


What if there was a bit of incentive on that overtime? What if the employer says "It’s an hour, two hours tops, but if you do this we’ll pay you an extra weeks wages?" Does that sound a little more inviting? Would even those who wouldn’t be coerced to stay for nothing stay for an offer like that?


Overtime’s one thing. Having it sprung on you when it might be inconvenient is another. It takes a genuine gesture for us to not feel taken advantage of in those times. Would trading 2 hours work for 38 hours pay seem like a grand enough gesture?


I don’t know about you but I never found a boss that wanted to be that generous. So today I want you to think about the hour or two of work you could do on your home finances that could make a big difference over time, and I have a few recent examples of this from Welcome Home.


I like to review our bills around here once a year. With a new kid on the block, the business battle with the Dover fallout and 2 year old who prefers Daddy’s not working time to be building pillow forts instead of being on a computer, I’ve been doing this in dribs and drabs over the last 6 months. The mechanic’s worst car is always his own right?


Anyway, I noticed in a recent bill that our electricity provider is now offering gas. This reminded me that I’m a few months overdue to look into our providers. While there’s a number of online options to review this, as a general rule, I like to stay away from the comparison websites that show only products they’ll get paid a commission on. Here in Victoria that leaves me with:


https://compare.energy.vic.gov.au/


My understanding is the rest of the country can go to:


https://www.energymadeeasy.gov.au/


I followed a few instructions (including uploading some information from the meter and our last bill) and in just a couple of minutes I was shown an offer that’ll save us around $400 a year, it was even with the same company we were already using. A few more clicks to compare gas and the savings have added another $200. A phone call and 5 minutes later and it was all locked away.


A couple of weeks ago now, I made what was probably a well overdue change for mine and Alison’s super. Granted, there was a bit more work involved to narrow this one down however, from an already competitive super fund we’re saving approximately $480 a year there too.


While Alison was in hospital before Gabrielle was born, we found ourselves burning through data. Turns out you spend a lot of time browsing for nothing in particular while you’re holed up in hospital. We buy phones outright so it was no problem to bump our $35 a month 1.5 GB plan up to $40 for 30 GB*. It’s not always about it having to be the cheapest - it’s about getting the best value.

*there are even better deals than this available if your phone is in your personal name, not a business.


The things I won’t let go more than a year? Home and contents or car insurance. Try as I might I must admit this I find this the hardest of all to compare. What I know is, even if you stay with the same company you’re best to call them on every renewal. For a few minutes on the phone you’re almost guaranteed to save money.



The ‘lazy’ tax is a staple in the industry - the best deals are for the new policies and the premium on old policies always goes up.If you don’t renew with a new policy or a phone call to get the best discount (check online before calling) then you will be paying too much.


That’s all well and good I hear you say. But it’s not really that much of a difference. It’s interesting what we consider to be worth putting a little effort in for. I come back the work situation mentioned at the start of this article. I doubt too many people would knock back a weeks wages for a couple of hours work. But keeping bill providers honest often goes unchecked. So let's look at some numbers to see what the difference really is.


Let’s use the annual savings we’ve had here recently. Using round numbers, they are:

  • Electricity: $400

  • Gas: $200

  • Superannuation $500

  • Home & Contents $100 (I’d expect this as a minimum as a result of not accepting the renewal figure that is sent to me)

  • Car insurance $100 (again, I'd expect this as a minimum)

Let’s also give the phone a value of $100. Even though the cost has gone up $60 a year I think we’ve got more than that in the value of extra data.


All up there’s $1,400 in savings, or added value, by a little bit of research online and a few phone calls.

The average Australian wage currently sits at $85,982, including the average overtime. A week's worth of work gets you:

  • $1,654 before tax.

  • $157 into super before tax.

  • $1,256 into the bank account after tax.

  • $134 into super after tax.

The great thing about reducing expenses is there’s no tax to be paid on that. So compare the after tax outcome above with the savings we’ve recently enjoyed:

  • $900 savings or added value into the bank account.

  • $500 into super.

In this case, an outcome that looks a lot like an extra weeks wages, with a little salary sacrifice into super. Not bad for a few hours work.


Do you want to get even more bang for your buck? These tips have saved us a considerable amount over the last few years as well.

  • If you have health insurance with extras, call your insurer and ask for a statement to show all the extras you’ve claimed in the last 12 months and how much having extras has cost. I’m pretty confident you’ll find you’re paying a lot more than what you’re getting back.

  • Review your health insurance. Forget about the highly advertised comparison sites. Where you want to go is: https://www.privatehealth.gov.au/dynamic/search. Fill in a few details and find a policy that fits your needs. (Personally, we have top hospital cover and no extras. We don’t need an expensive savings plan, which is all extras is, and I don’t want to choose what illness we don’t get a choice of the best care for.).

  • Start buying your mobile phones outright. This works on a few levels:

  1. You start to realise it as the expensive purchase it is (They’re not really $20 a month, the cost is being hidden).

  2. You start to realise you don’t usually need an upgrade every year.

  3. You get access to much better phone deals when you're not tied to needing a phone as well.

So why not allocate a little time to putting some money back into your pocket this week? Big companies are getting enough of it already, don’t let them take more than you have to. Remember, it’s always easier to save a dollar than it is to earn one.

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All strategies and information provided on this website are general advice only which does not take into consideration any of your personal circumstances. Please arrange an appointment to seek personal financial and taxation advice prior to acting on this information. Every effort has been made to offer the most current, correct and clearly expressed information possible within this site. Nonetheless, inadvertent errors can occur and applicable laws, rules and regulations may change. Any opinion provided on this website is the opinion of Mitchell Johnston and do not represent the opinions of Bluewater Financial Advisors, Vow Financial or any other person or company. 

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