The daily costs of keeping Australians awake at night, including groceries, gas and rent
New data from Canstar’s Consumer Pulse Report 2021 revealed that most Australians fear ordinary living expenses will rise to an unmanageable level over the next twelve months.
According to the report, which surveyed 2,000 Australian adults, the main financial problems were the price of groceries (14%), the price of gasoline (11%) and the rising cost of rent (10%).
The proportion of Australians who reported living within their means has fallen to just 66%, meaning more people than ever have stretched their household budgets just to cover regular costs.
Canstar financial expert Steve Mickenbecker told 9News.com.au that normal salaries are not rising fast enough to cover life in Australia.
“The cost of daily living hurts the hip pockets of Australians,” Mickenbecker said.
“Prices are rising faster than wages, making it harder to put food on the table and fuel in the tank.”
Outside of a mortgage, credit card payments have remained the main source of debt, with those heavily dependent on credit finding themselves deeper into the hole than 12 months ago.
“The proportion of Australians in debt has increased only slightly by one percent, but those in debt owe a lot more than a year ago, reaching almost $ 16,000,” Mickenbecker said.
“While credit cards remain the main culprit in debt, a growing number of Australians are piling up and now paying their debts later, and it’s not just the younger generations either.
“The debt story is not all pessimistic, as the majority – 76% – of Australians with money to pay think they can handle it.”
Much has been said about Australia’s roaring real estate market – which saw record growth of 21.9% in 2021 – with Mickenbecker noting that it is the younger generations who will suffer the most.
“Canstar’s results show that young Australians are seen to be the hardest hit when it comes to buying their first home, although I suspect the debate will continue to rage for generations to come,” said Mickenbecker.
“Soaring house prices in 2021 make the task of building up a deposit even less accessible for first-time buyers. By introducing higher capital requirements for banks, APRA hopes to slow the growth of house prices, but banks are already charging higher interest rates for investment, this may not be enough.
“If Australia’s dream of homeownership is to survive this decade, we need to slow investment lending by easing the brakes now. If next year is another year like 2021, we have to put the brakes on.”
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