Families urged to live within means

TREASURER Scott Morrison wants Australia to learn to “live within our means’’ but it’s a struggle for most family budgets with household debt quadrupling to $250,000 on average.

Australia has the fifth highest household debt levels in the world according to some ex- perts. Low interest rates and low unemployment have contributed to Australians going on a debt binge that could prove nasty if the economy takes a turn for the worse.

The nation’s “Buy Now, Pay Later’’ philosophy is laid bare in a report featuring the same title prepared by AMP and the National Centre for Social and Economic Modelling.

It finds that a 2.5 per cent increase in interest rates would force thousands of families to pay nearly 60 per cent of their income on the mortgage putting them at significant risk of defaulting or serious housing stress.