More of us live week to week
DESTITUTE Australians are leaving themselves vulnerable by having no savings at all and many admit they are in monetary stress, alarming new figures reveal.
One in seven Australians — or the equivalent to 2.6 million people — are in severe or high financial stress and have no cash stashed for a rainy day.
Instead they are living week to week and will not be able cope if they are struck by an emergency that requires instant funds.
And one in three people admit they are two pay packets away from suffering serious financial stress if they did happen to lose their job.
The new annual Financial Resilience in Australia report released last week by the Centre for Social Impact in partnership with National Australia Bank, revealed a worrying problem.
The data compiled by Roy Morgan polled more than 2000 Australians on their financial resilience last year and the rising cost of living combined with bigger household expenses that were pulling on purse strings.
NAB CEO Andrew Thorburn said it was vital financially strapped Aussies didn’t leave themselves with no cash reserves in case of an emergency.
“The cost of living is a real concern for many Australian households so when they are hit with an unexpected bill it can be difficult to bounce back,’’ he said.
The report revealed that one in five people could not or did not know if they could raise $2000 in a week — an increase from one in eight in 2014. And just one in three Australians say they feel financially secure (31%) — a 5% decline on the previous year. The findings come after the Australian Bureau of Statistics revealed the average amount of household debt had doubled in 12 years — from $94,100 in 2002-04 to $168,600 in 2015-16 which includes home loan debt.
Good Shepherd Microfinance CEO Adam Mooney said that over the past five to 10 years there was no doubt income inequality was rising and household debt was up.
“There’s been a large shock to manufacturing in Australia closing down ... some people have been forced to take out loans to draw some standard of living,” he said.