Half of Aussies unable to save due to cost of living

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on December 17, 2021 Fact Checked
Half of Aussies unable to save due to cost of living

With the borders reopening, many have holidays and houses on their to-do list. But new research reveals the cost of living may hold them back.

As the new year approaches and life seems to be returning to normal, new research commissioned by 86 400 looked into how Aussies approach saving money.

From the 1,000 people surveyed, it revealed Gen Z and Millennials are now more likely to save than they were pre-pandemic (53% and 51% respectively).

However, the 'biggest roadblock' was found to be the cost of living - such as rent and utility bills - with these expenses stopping one in two (50%) respondents from saving money.

NSW and Victorians are particularly feeling the pinch, which 86 400 said is "not surprising at all" given Sydney and Melbourne both made the top 20 list of most expensive cities in the world to live.

Head of Everyday Banking at 86 400 Belinda Stewart said many Aussies are focused on getting back on their feet financially and in control of their money.

"Especially after the tough couple of years we’ve all had in lockdown, feeling good about our finances, how we spend and save is a priority for all,” Ms Stewart said.

Keen for a holiday and a house

With travel back on the cards, 44% of Aussies revealed saving to travel in 2022 was a 'big goal'.

Particularly, 24% of respondents plan to travel overseas and 26% plan to travel domestically in the new year.

The pandemic served as a 'wake up call' for younger generations to focus on their futures according to 86 400.

Gen Z and Millennials are focused on nesting, with almost half currently saving for a house deposit (47% and 43% respectively).

Additionally, over a third of Gen Z (21%) and Millennials (15%) are saving for other investments (shares or crypto).

What's the key to saving success?

According to the findings, having a savings goal is what drives younger Aussies to save (63% of 18 to 24 year olds; 54% of 25 to 34 year olds), as well as watching their bank account balance grow (57% of 18 to 24 year olds; 55% of 25 to 24 year olds).

Having a good old fashioned budget is what helps older people save (50% of 45 to 54 year olds; 51% of 55 to 64 year olds; 42% of 65+ year olds).

When it comes to how Aussies are saving their money, 86 400's research divides savers into two groups: "sometimes savers" and "super savers."

Over a third (38%) described themselves as sometimes savers, going through seasons of saving and splurging.

Another third (35%) are self-described super savers, following a budget and staying focused on their financial goals.

"While each generation may have a different approach to spending and saving, the power of financial goals in helping Aussies to save is undeniable," Ms Stewart said.

"By setting multiple saving targets, both short term wins and long term gains - people can set themselves up for success without having to live on a shoestring budget." 


Image by Michael Longmire on Unsplash

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Rachel is a Finance Journalist, and joined Savings in 2021. Coming from a background in the FinTech space, her interests include the innovation of lending technology, property, investing, and more. With a passion for educating and informing people about their finances, she hopes to increase the financial literacy of everyday Australians.

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