While many may rue the pandemic for ruining retirement savings and nest eggs – at least in the short term – it seems it’s also taught Australians valuable money lessons that will benefit them in future.
A MyState Bank survey reveals that almost half (48 per cent) of the 1000 respondents want to better manage their money by reining in spending on discretionary items during the first six months of the new year.
The survey shows a silver lining from the pandemic, as Australians now wish to be more engaged with their finances. Three in 10 Aussies are now looking to either start or maintain a budget.
“More consumers are actively questioning their needs versus wants at the checkout and, according to our latest research, aligning their financial behaviour accordingly,” said MyState Bank general manager, customer experience, Heather McGovern.
“It is encouraging to see many Australians seeking out ways to build a financial buffer, whether that is by having a staycation, cooking more at home, or swapping the gym for outdoor exercise.”
More Australians are looking to futureproof their finances by paying down their debts now in order to protect themselves from future economic shocks.
According to the results: “Paying off interest-accruing debt also proved high on Australians’ list of new year money resolutions, with one in five planning to pay off their mortgage faster. Meanwhile, 17 per cent of consumers resolved to tackle credit card and personal loan debt”.
They’re also actively trying to save money, with 50 per cent of respondents saying they plan to spend less on travel over the next six months.
But these planned savings may have as much to do with effects of the pandemic on some sectors as they do with deliberate changes to consumer intentions.
“Despite life returning to some level of normality, our research shows the COVID-19 pandemic continues to impact Australian’s spending. For instance, the closure of gyms at the height of social distancing restrictions caused many Australians to invest in a home gym or complete workouts online. It seems some of these habits are carrying over well into the new year, which can spell good news for our wallets,” said Ms McGovern.
The research shows that consumers are also less likely to spend on gambling, toys and games, takeaway food and delivery, alcohol and cigarettes, and skincare and make-up.
Are you planning to reduce your spending on discretionary items this year? What type of spending behaviours do you plan to change or reduce this year?
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