6.9 millions Aussies living pay to pay: ‘Worrying’
A growing number of workers are struggling to make ends meet.
Aussies are struggling more than ever, which is why the rising cost of living was a major theme of yesterday’s federal budget.
Around one in two workers are living paycheque to paycheque, according to a Finder survey of 668 Aussie workers.
That’s more than 6.9 million people unprepared to cope with a job loss, admitting they couldn’t survive financially for more than a month if their income dried up.
Also read: OPINION: A good budget for difficult times
Also read: Budget 2023: Millions to get up to $500 in energy bill relief
Also read: Budget 2023: Centrelink cash boost for 1.1 million Aussies
Finder’s research found 17 per cent – equivalent to 2.3 million workers – were living day to day, only able to make ends meet for a week or less should they become unemployed. That figure is up from 14 per cent a year before.
Budget no silver bullet
Just 40 per cent of people could live off their savings for three months or more if they suddenly became jobless.
Finder head of consumer research Graham Cooke said the federal budget wouldn’t provide a silver bullet for the crisis.
“The scary reality is a worrying number of Aussies are running out of money before payday,” Cooke said.
“While the government relief announced will be welcome news to some, it’s up to consumers to safeguard themselves.”
Who’s struggling the most?
A shocking 61 per cent of households with a combined income of $50,000 to $99,000 admitted they were living paycheque to paycheque, compared to 42 per cent of households earning $100,000 or more.
Cooke said living pay to pay left no room for saving or investments, making the cycle very hard to break.
“Having no savings buffer makes it very difficult to achieve long-term financial goals such as buying a house,” he said.
“Even if you are happy with your job, you still need to mitigate the risk of something going wrong.
“Having no disposable income leaves you vulnerable to unexpected financial emergencies, which can lead to dependence on credit cards, and mounting debt that can be difficult to escape.”
Follow Yahoo Finance on Facebook, LinkedIn, Instagram and Twitter, and subscribe to our free daily newsletter.