According to NAB’s latest Financial Hardship report which surveyed 2000 people, a quarter of Australians are becoming more and more concerned about making ends meet.
One in three identified money as a significant cause of stress in their lives, the NAB report revealed that the most common forms of difficulty wer not having enough money for an emergency (21%), not having enough money for food and basics (16%), and being unable to pay a bill (14%).
Furthermore, one in five said they had missed paying a bill in the past three months, with most being energy and water bills.
Financial difficulty was also found to be more common among those among younger age groups (18 to 29-year-olds and 30 to 49-year-olds).
Interestingly, despite rising interest rates, the report found that being unable to meet mortgage repayments was causing Australians the least amount of financial challenge (5%).
This may be due to borrowers drawing on the savings they accumulated during the pandemic to repay their mortgages or to the fact that many borrowers were ahead with their loan repayments.
Another reason is that many borrowers are still on fixed rate mortgages and have not yet felt the full brunt of the interest rate increases. This reprieve, however, will come to an end for a large number of borrowers in April/June when most fixed rate mortgages, taken out when interest rates were in the 2 to 3% range, come off their fixed rate term.
If your fixed mortgage is due to change to variable rate, it may be advantageous to see us.
We are here to help you (or help our customers and prospective clients?) make the transition from fixed to variable and minimise the impact of higher interest rates on your household budget.