How we handle financial problems

While our money worries have heightened during the pandemic, we can find some comfort that we’re also making sensible choices with our personal finances. In fund manager Fidelity’s recent Pulse Survey, 45.7% of Aussies reported their money worries had increased since the crisis. More than 63.4% say they will reduce their discretionary spending over the next six months. Alva Devoy, managing director at Fidelity International Australia, says the pandemic has changed the way many of us live and work.

“For the more fortunate, this might provide opportunities to save or spend in a more considered way. However, for many it is causing significant worries from job security to the impact of market volatility on savings,” he says.

“While we cannot predict how this current crisis will develop, there are steps individuals can take to mitigate the impact on their own finances, reduce their worries and improve their overall wellbeing. Taking a long-term view will be key.”

More than half (54%) said they would reduce spending on essential items like food and clothing during the next one to six months, and this is on top of other actions such as selling shares, property or other assets. However, 26.1% said they plan to access their superannuation early in the next 12 months.

Almost one in three (29.4%) of those currently employed were worried about job security, far more than the pre-pandemic level of less than one in five (18%). This skyrockets to 45.4% among those in casual employment.

More than half of people (55.4%) said they could only last three months or less if they were suddenly made unemployed, including 16.9% who would not be covered at all.