Financial Stress

Who’s the most stressed about financial debt?

Last updated: 28 March 2018

Based on the latest Q4 2017 NAB Consumer Behaviour Report released by National Australia Bank (NAB), many Australians are continuing to face levels of stress around future spending and savings plans, household finances, the economy and other financial concerns.

 According to the findings from the report, across all consumer groups, a divorced, single father aged 30-49 (Gen X) has been identified to experience the most financial pressure in Australia when it comes to financial outlook. Let’s call him Floyd – the most financially-anxious person in Australia. Floyd lives in Perth with his two young children and has a part-time labouring job, earning less than $35,000 with vocational training.

single father with 2 kids

What are the key stress drivers?

 

Cost of living

The NAB report shows that cost of living is the highest concern of Australians in Q4’17. Almost 1 in 4 (24%) consumers across all key groups reported “high” levels of concern over the cost of living during the quarter.

Floyd is particularly concerned about his cost of living, specifically his utility, grocery and transport bills, simply due to his household size (≥ 3 people). Not to mention the rental payments, taking a huge chunk of his take-home pay. Whether it is mortgage or rental repayments, these factors continue to be one of the highest financial concerns amongst the Gen X group.

 

Medical and healthcare bills

The ability to cover medical and health expenses is also a huge headache for Floyd. For a household of three, medical expenses can range from an average of $30-$80 a week. If one of his kids needs to get a dental check or needs to seek hospital treatment due to an injury from soccer practice, these expenses could start to add up.

 

Providing for the family’s future

Financial struggles might be higher for Floyd, as a part-time labourer with vocational training his income might not be able to cover all expenses as a household of three, which may lead to insufficient savings to secure financial stability for his family.

 

How can we better manage debt and improve our financial wellbeing?

If you are currently in financial stress, like Floyd, the Credit Savvy team have put together some tips below to help you manage debt and become financially fit.

  • Contact your credit provider to seek hardship assistance. Your lender could arrange a flexible payment plan, such as spreading out the balance owing evenly throughout the year.
  • Plan ahead. Research online and utilise our comparison service to help you find better deals on credit products.
  • Set a budget and track your spends. How much money is coming in and how much is going out?
  • Set up regular payments by direct debit to pay off those important bills. Once you have set your budget and know your money’s ins and outs, this setup can help you reduce the chance of missing a payment.
  • Change your spending behaviours. Prioritise spends on essentials and decrease purchases on non-essentials.
  • Consolidate your debts. If you own a few credit cards, keeping track of all your repayments and how much you still owe can get a little tricky. You might like to consider consolidating them all into one personal loan. Head over to our comparison service to view more debt consolidation personal loans.
  • If you’re really struggling with debt, then try to avoid credit altogether. Consider using cash only or a debit card so that you only spend the money that you actually have.

Many Australians could be unknowingly contributing to their levels of financial stress by paying more than they need to on their credit products. Sign up for your free credit score today to let us help you find better home loans, personal & car loans, credit cards, business loans and discover other offers that are tailored to your credit score.

Credit Savvy offers a range of calculators and learning resources, including useful articles to help everyday Australians, like yourself, to take control of their credit reputation and financial wellbeing.

 

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