Raise your hand if you’ve already spent your paycheck within a week of receiving it? You’re not alone.
According to a new study by Mozo, 1 in 2 Australians save less than $ 200 per month, with 16% of people aged 25 to 34 admitting to being strapped for cash before payday.
And when times get tough, research has found Australians choose to cut back on their purchases rather than cut back on their internet and mobile use or pay-TV subscriptions.
“Mozo’s latest research indicates that many Australians are struggling to make a living, with half the country saving $ 47 a week. With stagnant wage growth and the cost of living steadily rising, it’s no wonder many Australians are struggling to make progress, ”said Mozo spokesperson Gemma Rasmussen.
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When it’s time to deprive yourself of life’s little luxuries, dining out or taking out has become the number one expense choice to avoid. This was followed by going to the movies and buying new clothes.
Purchases of basic items such as fuel and cleaning supplies were ranked last, suggesting Australians are more inclined to cut frivolous spending first.
However, Rasmussen reminded Australians of the importance of thinking long term on payday.
“Payday can bring an undeniably good feeling, and having enough money to see the end of the month can often seem like tomorrow’s problem,” she said.
“That said, the stress of seeing your bank balance go down to zero before your next paycheck arrives can be terrible, not to mention the broader, long-term issues that arise, such as rising debt. and the lack of savings. ”
Budgeting, or the lack of it, was also a concern, with data revealing that 29% of Australians either did not have a budget or only had a rough idea of their finances in mind.
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Get back on track
Think it’s time to get back to basics by creating your own budget? Check Out Mozo’s Best Budgeting Tips!
– Break down your expenses: When building your budget, categorize your expenses: household, food, transportation, recreation, and personal expenses. It’s much easier to see what you’re working with up close, instead of estimating your monthly expenses.
– Second guess the plastic: If you think your credit card is keeping you from reaching your savings goals, consider whether it’s worth giving up debt with a balance transfer credit card or using your debit card. only at checkout.
– Make savings compulsory: Even saving as little as $ 50 a month can make all the difference in a year, so make sure you pick an amount that’s realistic for you and set it aside every payday.
Need a place to store your hard-earned savings once your budget is running? Our savings account comparator compares over 200 savings accounts from 60 banks, so you’re bound to find the one that suits your savings goals!