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Four in 10 Australians experienced some form of financial hardship in the second quarter, according to recent data.
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Financial hardship levels above average, survey reveals
31 July 2023
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The latest NAB Consumer Insights Survey indicates that 43 per cent of Australians experienced some form of financial hardship in the second quarter off the back of rising inflation and higher interest rates.
This is a significant rise from a survey low of 29 per cent in the first quarter of 2022.
Not having enough money for an emergency remains the most common cause of financial hardship or stress and impacted 24 per cent of people in Q2.
Around one in five Australians overall also said hardship was caused by not having enough money for food and basic necessities or being unable to pay a bill. Noticeably more women, people under the age of 50, and people in lower income groups experienced these hardships in the second quarter.
The most common type of payment missed was an electricity, gas or water bill (12 per cent up from 8 per cent at the same time last year), followed by a phone or internet bill (11 per cent up from 8 per cent in Q2 2022), a repayment on loans from family or friends (10 per cent up from 7 per cent in Q2 2022) and a credit card payment (unchanged at 9 per cent but up from 6 per cent at the same time last year).
Slightly more Australians also missed a Buy Now Pay Later (BNPL) or insurance payment at eight per cent.
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The number of Australians unable to make mortgage repayments in the second quarter was unchanged at 6 per cent despite rising interest rates.
Money a source of stress for one in three
The survey also indicated that 34 per cent of Australians believe ‘very much’ that money is a source of stress in their life and that 26 per cent feel they are struggling to make ends meet.
This was highest in the 30–49 age group with 42 per cent stating that money was a source or stress. There was also a higher number of individuals in this age group struggling to make ends meet at 31 per cent.
The research also found that 28 per cent of respondents felt that they could not manage a major unexpected expense at all.
Around three in 10 felt they were not on top of their day to day finances or did not believe they were on track to have enough money to provide their financial needs in the future.
“Noticeably more women than men indicated they were not doing very well in all these aspects of their finances, as were those in the lower income group,” the NAB survey report stated.
The survey report said while financial hardship can happen at any time, and is often the result of sickness, job loss or over-commitment, the rising interest rates and cost of living is now also causing financial distress in more households.
“Financial hardship in the second quarter remained above average in all age groups. It was highest in the 18-29 group at 55 per cent, up from 50 per cent in the first quarter, followed by the 30–49 group which was unchanged at 50 per cent,” the report said.
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