Nearly one in five Australian households are spending more than they earn, but the average household is still focused on saving.
New research from ING
Direct has revealed that 18% of Australians are spending more than they earn. ING
Direct treasurer Michael Witts said the overspending could correlate to credit card debt for some households.
“It’s interesting to note from the research that many respondents who indicated an uncomfortable level of credit card debt also recorded higher than average expenditure across most essential items. This suggests Australians may be using their credit cards as a bridge during a temporary change in circumstances,” Witt said.
But savings among Australian households remain strong. The average household saves 6.2% of their take home pay, and households have accumulated median savings of more than $14,000.
Witt said that the largest chunk of household earnings - unsurprisingly - is spent on essentials such as rent or mortgage, utilities, transport, grocceries and health.
“In the context of a booming WA economy fuelling higher salaries and house prices it’s perfectly understandable that Western Australians spend the most – almost $500 more than their South Australian neighbours. Household bills are fairly evenly split across all the states and a big expense at an average of $633 a month,” Witt said.