Household savings rate skyrockets after JobKeeper, increased JobSeeker

author-avatar By on September 02, 2020
Household savings rate skyrockets after JobKeeper, increased JobSeeker

Photo by Ryoji Iwata on Unsplash

Australian Bureau of Statistics data released today reveals the household savings ratio increased to 19.8% off the back of JobKeeper and increased JobSeeker.

With households saving nearly a fifth of their income in the June quarter, this is up from 6% in the March quarter, and up from just 2.5% in 2019's June quarter.

The Australian Bureau of Statistics (ABS) is putting increased savings down to a fall in consumption expenditure, down 12.1% in the June quarter, and boosted social assistance benefits, such as the JobSeeker Coronavirus Supplement, which in cash increased by 41.6%. 

Need somewhere to store cash and earn interest? The table below features savings accounts with some of the highest interest rates on the market.

Provider
Total interest
rate p.a.
Base interest
rate p.a.
Bonus interest
rate p.a.
 
Fast Track Saver
1.50% 0.20% 1.30% Go to site
1.65% 0.15% 1.50% More details
1.60% 0.10% 1.50% More details
1.60% 0.15% 1.45% More details
1.60% 0.40% 1.20% More details

*Data accurate as at 01 October 2020. Rates based on a savings balance of $10,000. Introductory bonus interest rate products not included. Sorted by total interest rates. Refer to providers' websites for bonus rate conditions.

Hours worked also fell 9.8% in the June quarter, which outpaced the 2.5% decline in wages, buoyed by JobKeeper payments.

Gross Domestic Product also fell by 7.0%, the largest ever quarterly fall on record in Australia - the series began in 1959.

Without JobKeeper, increased JobSeeker, and the 'Boosting Cashflow for Employers' policies, household income would have fallen to $283.5 billion - $48 billion lower than ABS' figures.

In total, household income rose $7.1 billion driven by gross income and social assistance benefits.

The ABS also cited loan deferralsearly access to superannuation and rent deferrals as boosts, despite them not being tallied as household income.

Early super access added $18.1 billion to total gross income, while loan and rent deferrals amounted to $1.5 billion. 

Westpac senior economist Andrew Hanlan said the increased savings rate provides households with a "considerable buffer to draw upon in coming quarters".

"Wage incomes fell by only -2.5%, while gross disposable income jumped by 2.2%, or up by a massive 2.9% in real terms," he said.

"This is because of the wage subsidy scheme and other income transfers from the government sector."

The news comes after AMP last week released research into how benefits payments have affected incomes, with incomes up by a net amount of $5,000 since mid-March.

However, the Australian Council of Social Service (ACOSS), in conjunction with the University of NSW, found that without such assistance, Australians living in poverty would have almost doubled.

Instead, there has been a 13% drop of the number of people in poverty.


Latest Articles

author-avatar
Harrison joined Savings in 2020. He is a journalist with more than four years of experience, with previous stints at News Corp and financial comparison site Canstar. With a keen interest in personal finance, Harrison is passionate about helping consumers make more informed financial decisions.

Collections:

Get free insights & tips monthly

By subscribing you agree to the Savings Privacy Policy

Loading data please wait...

{{returnData.productName}}

Overview

Current Rate

{{returnData.currentRate | percentage:2}}

Comparison Rate*

{{returnData.comparisonRate | percentage:2}}

Rate Type

{{returnData.rateType}}

Advertised Rate

{{returnData.advertisedInterestRate}}

Comparison Rate*

{{returnData.comparisonRate}}

Monthly Repayment

{{returnData.monthlyRepayment}}

Interest Type

{{returnData.interestType}}

Total Interest Rate

{{returnData.totalInterestRate | percentage:2}}

Base Interest Rate

{{returnData.baseInterestRate | percentage:2}}

Bonus Interest Rate

{{returnData.bonusInterestRate | percentage:2}}

Total Interest Rate

{{returnData.totalInterestRate | percentage:2}}

Introductory Rate

{{returnData.introductoryRate | percentage:2}}

Introductory Term

{{returnData.introductoryTerm}}

Base Interest Rate

{{returnData.baseInterestRate | percentage:2}}

Term

{{returnData.term}}

Advertised Interest Rate

{{returnData.advertisedInterestRate | percentage:2}}

Interest Frequency

{{returnData.interestFrequency}}


Fees and Features

Ongoing Annualised Fee

{{returnData.annualFee}}

Upfront Fee

{{returnData.upfrontFee}}

Offset Account

Redraw

Principal & Interest

Interest Only

N/A{{returnData.interestOnly}}

Max loan to value ratio (LVR)

{{returnData.maxLVR | percentage:0}}

Lump sum repayments

N/A

Additional repayments

Maximum Loan Term

{{returnData.maximumLoanTerm}}

Upfront Fee

${{returnData.upfrontFee}}

Ongoing Monthly Fee

{{returnData.ongoingFees}}

Early Repayment Fee Applies

N/A

Vehicle Types

{{returnData.vehicleType}}

Maximum Vehicle Age

{{returnData.maximumVehicleAge}}

Pre Approval Available

N/A

Online Application

N/A

Account Keeping Fee

{{returnData.accountKeepingFee}}

Minimum Monthly Deposit

{{returnData.minMonthlyDeposit}}

Linked Account Required

N/A

Interest Calculated

{{returnData.interestCalculated}}

Interest Paid

{{returnData.interestPaid}}

Online Application

N/A

ATM

N/A

EFTPOS

N/A

Account Keeping Fee

{{returnData.accountKeepingFee}}

Minimum Monthly Deposit

{{returnData.minMonthlyDeposit}}

Linked Account Required

N/A

Interest Calculated

{{returnData.interestCalculated}}

Interest Paid

{{returnData.interestPaid}}

Online Application

N/A

ATM

N/A

EFTPOS

N/A

Minimum Deposit

{{returnData.minDeposit | currency : '$' : 0}}

Upfront Fees

{{returnData.upfrontFee | currency : '$' : 0}}

Annual Fees

{{returnData.annualFee | currency : '$' : 0}}

Notice Period to Withdraw

{{returnData.noticePeriodToWithdraw}}

Online Application

N/A

Automatic Rollover

N/A

Maturity Alert

N/A