Working from is now a common reality due to COVID-19. Almost half of the employed Australian population have now worked from home in some capacity over the past few months.
When it comes to the financial impacts of remote work, there are numerous factors that you should consider to determine how much money you can save. These factors include taxes, transportation, food costs, childcare expenses and general spending.
First consider where you can save money by reducing expenses. Transport is a great area in which to save. The cost of commuting to and from your workplace on a daily basis might seem small, however it is an expense that adds up. For example, even a cost of $5 a day on bus fees will add up to $1,825 in a year, and almost $10,000 in five years. If you usually drive to work, this figure might be even higher once you factor in petrol, parking, tolls and car maintenance.
How much can you save on your food? When you are working at the office, you might buy takeaway coffees and lunches daily. It’s easy to justify when you are working to a schedule and are stressed and focused on work. You can save that money every day by making your lunches, coffee and snacks while working from home, allowing you to save every day.
You might be able to save on childcare. It can be difficult to work from home and supervise your children simultaneously but if you can manage it, you’ll save a lot of money. You’ll also spend more time with your kids.
Finally, if you are working from home, you may have the chance to claim deductions for work related expenses. This might be the most effective way to save while working at home, provided you follow the process comprehensively.
With an increased use of utilities and equipment in your home, a working from home deduction can be claimed through the ATO. If you are eligible, they offer deductions based on a fixed rate or your actual expenses. If this is an area that you are looking into, you’ll have to consider things like phone and internet usage, any stationary and consumables you are using to work, and a decline in the value of your computer. While these savings are usually limited to taxes, you can use something like a mortgage calculator or get in touch with your home loan provider if you want more information and knowledge regarding how you can save on home and mortgage payments.
Are There Any Financial Downsides to Working From Home?
Firstly, you will probably have to pay for office supplies and other small expenses yourself. Some employers are reimbursing employees for these costs but others aren’t.. You might want to purchase larger and pricier office items such as office furniture, a webcam, software, or a laptop that can handle your work. While you might be able to claim deductions on these things, there is a chance the costs will remain higher than in an office situation.
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