Concerning new research reveals 4.2 million working Australians were living hand to mouth well before the coronavirus crisis and working older Australians were struggling the most.
The findings, which come from an independent survey of a nationally representative panel of 1006 Australian adults commissioned by Money.com.au, show that 43 per cent of working Aussies over-60 are either in debt or have under $100 left over after paying their monthly essentials.
The survey reveals that nearly a third (32 per cent) of employed Australians are either in credit or have under $100 left in their pocket, after paying all their essentials each month.
Essentials refer to mortgage/rent, bills, groceries, kids’ expenses, household maintenance and supplies, and loan repayments.
One in five (21 per cent) are either in credit or only have up to $50 left each month, after paying for essentials.
Worse still, 70 per cent of Australians believed their discretionary income would have been lower or the same this year, even before the crisis (33 per cent said it would have been lower).
The government’s cash handouts for lower-income Aussies were designed to inject money back into the economy. However, licensed financial adviser and Money.com.au spokesperson Helen Baker predicts this won’t be the case.
“The survey results confirm that Australians were already struggling to make ends meet and, therefore, have no safety net, with low wage growth and increases in household expenses the main factors,” Ms Baker explained.
“Businesses and workers have been so significantly impacted from coronavirus – particularly the travel, hospitality and entertainment industries – that there are forecasts there will be two million unemployed.
“No-one knows how long this pandemic will last and how much further the economy will decline, so those receiving government assistance will need their cash payments immediately to keep living, as fears grow around when, and if, their next paycheck will come through.
“The findings also show that our older population are struggling the most when it comes to having leftover spending money, with 43 per cent of over-60s admitting they’re either in credit or have under $100 left over after paying for essentials every month.
“It’s concerning, given that they’re at a stage in their lives where adequate funds should be set aside for retirement.
“They’re also facing more pressures to save as cost of living and healthcare rises, and people live longer. Money needs to stretch for longer, but instead it’s depleting more rapidly than in the past.
“Older Australians need to assess ways they can cut back on their spending to ensure they can retire comfortably, by considering downsizing and even taking on jobs such as Ubering or mowing lawns.”
How are your finances holding up during the pandemic? Are you struggling to get by? Should the government be providing more assistance?
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