How I saved $500 a year on health insurance – my 1st step to FIRE

How I saved $500 a year on health insurance – my 1st step to FIRE

I have been inspired lately to read into the Financial Independence Retire Early (FIRE) thinking and perhaps start executing some of the strategies. I don’t necessarily want to retire early, as I’m always motivated to start something, do something, but having financial independence? That would be nice.

I’ve been inspired because I’ve been staking out this covid-19 on a farm in the Southern Highlands (see the amazing sunrise I woke up to) and it hit me! I need a way to exit the rat race. I want to be able to wake up to the smell of fresh grass, and take a walk when I want to, life is too short.

OK – so back on FIRE. I’ve read a few articles and they all seem pretty impossible which means that there is something wrong with how I’m currently wired. I’ve never been a super materialistic person, I don’t spend on clothes or makeup, but for some reason, since graduating and working, I can’t seem to save a lot of money. Then I realised. Things add up. Because I always had the mentality of “hey it’s just $10 per month, it’s fine” or “only $30 to eat out or uber eats, it’s fine” but it all adds up to money that I can’t save to invest in my future.

Unfortunately, cutting out my car in my life or mobile phone is a little bit extreme for me so I’ve opted to go from the easier to hardest and see how I go. The easiest being my private health insurance which I have with MyOwn as they just sent me a promotion email to switch over to AIA Health Insurance.

I got onto the phone with a very helpful lady who asked a few questions about my situation. Being in my mid to late 20’s, I don’t have many health issues, but private health insurance is just something you need to get (above a certain wage in Australia you will need to take private health in order to not get charged a premium at tax time). I discovered also from having private insurance for more than a year I never used any of the “Extras” which I thought would have been handy when I first signed up. “Maybe I’ll get some glasses” (I have perfect vision), “Or see a physio” (I don’t love massages). The lady on the phone straight up told me if I don’t use them, don’t take the Extras because I’d save a hell lot. And if I needed them when I get older, I can always get them later.

So I said switch me over and my premium monthly went down from $122 per month to $80 a month, which is about $504 per year in savings! I know it doesn’t seem much but every cent I can save can go towards earlier retirement so that’s a win win. I also got a $50 voucher from their promotion and still have access to AIA Vitality (“what’s that?” you ask). AIA Vitality is an app / program that makes you make yourself healthier by giving you points and gift cards that gets unlocked when you exercise. For example, if you achieve certain goals per week, you unlock a $5 voucher to say Woolworths, uber eats and some other options. So if I can be constant in hitting my health goals (which in the app is counted per steps per day), then I can potentially save another $20 per month, $240 per year!

(Just a note I’m not affiliated with AIA Vitality but I just think it’s an awesome way to promote healthier living, by literally paying you to be healthier. I am also not promoting to cut back extras if you use them, but they were of no use to me at all so it all depends on your personal circumstances).

I’m quite excited to start my FI journey and will continue to update as I get better at cutting costs. What are some steps you have taken already and how has it worked out for you? Very keen to hear from other peers in FIRE.

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