The Australian Bureau of Statistics report our saving ratio is at a 17-year low – just 1.1% of total disposable income1.
Almost half (45%) of Australians have less than a grand in savings to fall back on2, according to recent Finder’s Consumer Sentiment Tracker findings.
On average, those surveyed with less than $1000 had just $210 in savings. That’s just over half the average $532.20 per week Australian households spent at the grocery store in 20233. And 20% of those under $1000 said they had nothing.
Unsurprisingly, 76% of respondents said their current financial situation stressed them – but the survey also found a staggering difference between the haves and have-nots.
Finder said that according to their research, the national average for savings was $36,095, thanks to “super savers” propping up the numbers. Once the 45% with less than $1000 are left behind, the remaining 55% average $65,078, which is about two-thirds of the average Australian full-time salary of $98,217.
But Finder head of consumer research Graham Cooke said Aussie households were nonetheless facing tough times.
“Millions are living pay to pay, with many running out of money long before they run out of month. Cost of living pressure in Australia is at a record high, which is why so many Aussies having no savings buffer is a huge concern,” he said.
“Even something as trivial as a flat tyre would be too much for many households right now. Those lower levels of savings mean people are much more likely to have to turn to credit cards, loans, and buy-now-pay-later products to get by,” he said. “Whilst these products can be great if used properly, they can quickly get out of hand if relied on for everyday expenses.”
Ideally, you should aim to have at least three months of income as a savings buffer to fall back on.
He urged people to find ways to reduce expenses and increase their income streams to get them closer to their savings goal. “Find what savings you can create in your everyday expenses – $50 shaved off your monthly car insurance bill could equate to an extra $600 by the end of the year.” Once you start building up your savings, “A high-interest savings account is designed to build up your savings and earn more interest than a standard bank account. A recurring investment of $100 a week into a high-interest savings account paying 5.5% interest would amount to $2642 in two years.”
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1 https://www.sbs.com.au/news/podcast-episode/savings-all-gone-youre-not-alone-and-its-intentional-says-economist/21anhicyt
2 https://www.9news.com.au/national/millions-of-australians-less-than-1000-dollars-in-savings/
3 https://www.finder.com.au/budgeting/average-grocery-bill
