Around 3.4 million Australians are living precariously with less than $1,000 in savings to draw on in the event of illness or unemployment, a new survey by InfoChoice has revealed.
The InfoChoice State of Aussies’ Savings survey found that approximately 16% of Australians have less than $1,000 in savings. Of those, 49% (1.6 million Australians) have depleted their emergency funds over the past month due to the soaring cost of basic needs such as food, energy, and shelter.
“Aussies are feeling the pinch from near-runaway inflation, which policymakers failed to wrestle in-time, and now higher interest rates to combat it,” said Harrison Astbury (pictured above), InfoChoice money analyst.
The InfoChoice survey revealed that many mortgage holders have less than one mortgage repayment worth of savings, with 10.6% reporting less than $1,000, and 25.5% having less than $5,000.
Renters are in a worse position, with 27.4% having less than $1,000 in savings and 50.2% having less than $5,000.
“It’s evident one or two more rate rises would break a lot of mortgage holders, while renters are barely holding on, with no short-term relief in sight,” Astbury said.
More than a quarter (27.3%) of respondents had less than a month’s income saved, with Gen X slightly worse off at 30.9%, while Boomers were in the best position with only 20.5% under the one-month threshold.
Renters were twice as likely as homeowners to have meager savings, with 43.2% having one month’s income or less in savings compared to 19.6% for homeowners.
“A general guide for a healthy emergency fund balance is anywhere from three to six months' worth of expenses,” Astbury said. “That level of security is a distant dream for millions of Australians right now.”
The InfoChoice survey also highlighted some interesting spending habits.
Gen Z spends significantly more on body modifications compared to other generations.
Female respondents are almost three times as likely as men to spend on tattoos, lip fillers, Botox, and other cosmetic items.
Meanwhile, men are three times more likely to spend on gambling, eight times more likely on drugs, and 10 times more likely on adult entertainment.
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