How much have Australians been putting away in their savings as the cost of living skyrockets? How are you up to it?
- Australians spend less with an average of $40,000 stashed away in savings in August
- The figure marks a 75 percent increase on $22,565 saved in March.
- More Australians chose to save as cost of living and grocery prices rise
Australians are saving more money than ever before with tens of thousands stashed away in their savings as the cost of living soars.
Consumer tracker Finder found that an average resident had $39,439 saved in August, much more than a few months ago.
The figure marks a 75 percent increase on the $22,565 average booked in March and a record since Finder began its investigation in May 2019.
Australians are saving more money than ever as the cost of living soars with nearly $40,000 sitting in savings, new research shows (file image)
Consumer tracker Finder has revealed that an average resident had $39,439 saved in August (stock image)
Finder money expert Sarah Megginson explained that Australians were becoming more cautious about how they spent their earnings.
“Australians are dramatically increasing the amount of cash they have stashed away to offset the spiraling cost of living,” he said.
“Consumers are concerned that high levels of inflation and rising interest rates are leaving them vulnerable and, where possible, are stocking up on cash to weather the storm.”
Australians could survive for 19 weeks without pay on those savings if they were suddenly out of a job.
Men have higher cash reserves than women with $52,786 saved compared to $26,132 in August.
“Saving a little is better than not saving at all; the habit of saving is the most important thing of all,” said Ms. Megginson.
‘Now is a good time to have excess cash in the bank with high-interest savings accounts offering rates of more than 3.1 percent a year, and time deposits are even higher.
“While the RBA raises the cash rate to 1.85% it’s bad news for borrowers, it’s good news for savers.”
The figure marks a 75 percent increase in the average $22,565 booked in March and a record since Finder began its research in May 2019 (Pictured, line graph of average amount of money saved)
Rising costs for gasoline, housing and food pushed the country’s inflation rate up to 6.1 percent, the highest in two decades, raising fears of a huge spike in interest rates in August.
The consumer price index in the June quarter soared at the steepest pace since mid-2001, and unemployment fell last month to a new 48-year low of 3.4 percent.
Headline inflation is well above the Reserve Bank of Australia’s target of two to three percent.
A tight rental vacancy market and higher energy prices caused housing costs to rise nine percent in the year to June 30.
Transportation costs rose 13.1 percent, while food prices rose 5.9 percent following the recent floods.