A recent Finder survey has highlighted a worrying problem in Australian society: almost half of Australians have less than $1000 in savings. This equates to 9.4 million people, with the average amount available to save per person being just $210.
In addition, 20% of respondents said they had no savings at all. These data reveal a significant difference between the financially insured and the uninsured.
According to the Finder, the national average savings rate is $36,095, largely driven by “super saver” households. However, this is mitigated by the majority of the population having less than $1000 in savings, with the remaining 55% of the population having an average savings of $65,078.
Graham Cooke, lead researcher, highlighted the cost of living pressures in Australia and said the lack of savings was a major concern. The need for financial security leads many to make risky decisions and rely on credit cards and loans.
In the midst of such difficulties, Mr Cooke urges people to set a goal of building up savings equivalent to 3 months’ income to meet the inevitable financial challenges. He also recommends the use of high interest savings accounts as a means of increasing savings.
In addition to individual initiatives to increase savings, it is also important that government policies focus on strengthening the financial security of citizens. This can include measures to increase wages, improve access to affordable housing, provide social benefits and improve educational and job opportunities.
In addition, banks and other financial institutions can contribute by offering savings schemes with attractive interest rates and by promoting financial education and information on how to manage financial resources.
Overall, highlighting the problem of low savings in Australia is an important call to action. A combination of individual initiatives and government policies is needed to build financial resilience and address the financial challenges faced by many citizens. Only in this way can we create a more economically just and humane society where economic security is accessible to all.
