Biggest financial worries for 2021

GROCERY costs, job security and energy prices are the biggest money worries for Australian households.

But despite the tough times they’ve managed to tuck away much-needed savings.

New research from financial services company Canstar shows nine out of 10 people are trying to use less energy to bring down rising household expenses — with groceries and gas costs the biggest concerns.

Job security was a worry for one in 10 people.

Canstar editor-at-large Effie Zahos said that while some people were able to save money during the pandemic others were struggling.

“Some have done amazingly well and are able to save so much more but others haven’t been able to do that and one in three had to dip into their savings,” she said.

“Things changed dramatically for us — when you shut down the economy you close your wallet.”

More than 2000 Australians were asked about their financial outlook for Canstar’s Consumer Pulse report.

The proportion of people living within their means climbed to 73 per cent, compared with 66 per cent when the previous survey was completed last year.

The latest Reserve Bank of Australia data showed Australians have reduced credit card debts accruing interest from $27bn in March to $20bn — the lowest in 16 years.

The amount of debt Australians are carrying has also fallen, by 38 per cent from $48,809 last year to $30,188 this year.

HSBC chief economist Paul Bloxham said a key focus of the federal government would be to reduce the jobless rate from 7 per cent in the new year.

“The economy still has to go through a lot of adjustment and there will be a few things that change in the postCOVID world, and some of that will play out in terms of job insecurity and we will learn which business models work and which don’t,’’ Mr Bloxham said.

He also said Australians had become better savers, tucking away 20 per cent of their incomes in the June quarter, compared with 6 per cent in the March quarter.

Melbourne small business owner Stefanie Reilly, 35, who runs a public relations agency, took a significant income hit at the start of the pandemic.

She signed up to Jobkeeper but quickly took herself off the scheme after her business income climbed by 1900 per cent.

“I went from one client and having to be quite frugal … to 14 clients,” she said.