Rising Costs Challenge Australian Savings: New Survey Insights
Rising Costs Challenge Australian Savings: New Survey Insights
2
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
The ongoing cost of living crisis is increasingly squeezing the wallets of Australians, with a fresh survey from Compare the Market offering new insights into just how precarious personal finances are for many.
A recent survey of 1,005 Australians highlights that nearly a quarter of participants (24.68 percent) could only support themselves for a month or less on their savings if they encountered a job loss or an inability to work. This statistic drops to 12.04 percent for those stating they could last up to two months, while a more fortunate 16.52 percent affirmed they could sustain their lifestyle for a year or more on their savings.
Chris Ford, a spokesperson for Compare the Market, remarked on the situation, stating, "The results of this study underline the tough economic environment many individuals and families are grappling with daily, as they navigate multiple interest rate hikes and inflation surges."
One particularly striking comparison is that Australians had higher debt levels than their American and Canadian peers. This trend is most pronounced among recent homebuyers, especially those under 41 years of age. The average Australian monthly savings figure stands at AUD 964, despite these financial hurdles.
Ford emphasized the importance of strategic financial planning, noting, "Savings remain crucial. That's why making informed choices on essentials-like insurance, home loans, electricity, and fuel-can aid in building a robust savings buffer."
The survey also included responses from 1,003 individuals in the United States and 1,002 in Canada. Approximately 24.23 percent of U.S. respondents could live on their savings for one month or less, while Canada reported a similar figure at 24.25 percent. Notably, both countries fared marginally better than Australia in terms of savings longevity, with 15.85 percent of Americans and 12.97 percent of Canadians able to last 12 months or more on their savings.
Debt comparisons showed that Australians hold the highest amounts, encompassing student loans, home loans, personal loans, and buy-now-pay-later (BNPL) debt. Australians owe, on average, AUD 145,140 (USD 93,935), compared to an average personal debt of USD 50,157 for Americans and CAD 50,967 (USD 37,032) for Canadians.
Additional findings reveal demographic nuances across countries. Americans and Canadians aged 26-41 are more prone to tapping into their savings monthly for expenses (37.62 percent and 33.35 percent, respectively). Conversely, the Australian Generation Z cohort, aged 18-25, reported being more frequent savers (27.61 percent using savings for expenses monthly).
Interestingly, Australian parents appeared most likely to dip into their children's savings to buffer personal financial shortfalls (15.48 percent), surpassing their Canadian (12.54 percent) and American (11.82 percent) counterparts.
Amid these revealing findings, the broader narrative underscores the necessity for prudent and informed financial management in navigating today's challenging economic landscape.
Published:Tuesday, 25th Jun 2024 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
Investors seeking exposure to Australia's leading companies have a standout option in 2026. BlackRock's iShares S&P/ASX 20 ETF has been recognised as the Best Australian Shares Exchange Traded Fund (ETF) by Money magazine's 2026 Best of the Best awards. - read more
As Australia enters 2026, the property market continues to exhibit resilience, with certain states poised for notable growth. Recent research from property analytics firm Cotality indicates that 87% of surveyed real estate and finance professionals anticipate home prices to rise over the year, with nearly half expecting growth exceeding 5%. - read more
As 2026 unfolds, Australians are set to experience several significant financial reforms that will impact various aspects of their personal and business finances. Staying informed about these changes is crucial for effective financial planning and decision-making. - read more
We've all felt the sting of rejection at one point or another, and being turned down for a loan can be particularly disheartening. It's a setback that many face, but it's not the end of the road. Understanding why your loan application was rejected is the first step towards improving your financial standing and securing future funding. - read more
Understanding interest rates is crucial when it comes to managing your personal loans effectively. Interest rates dictate the cost of borrowing and can significantly influence your financial health over time. - read more
In recent times, Australians have witnessed a notable uptick in the use of online personal loans. The trend emerges as part of a broader digital transformation, where convenience and speed take precedence. This shift has facilitated access to financial services with just a few clicks, making personal loans available to anyone with an internet connection. - read more
