According to CBA’s latest financial wellbeing report, although many Australians are easily affording their necessary daily expenses, one in three is not prepared for a “rainy day” and a further third are not on track to meet their retirement needs.
Aussies divided in ability to meet everyday expenses
The report, which surveyed Commonwealth Bank customers’ financial wellbeing through their responses to a series of questions as well as their financial records, found that one in four respondents believes they easily met their everyday expenses in the preceding year.
Encouragingly, 37 per cent said their finances rarely or never controlled their lives, while 40 per cent indicated they often or always had funds left over at the end of the month.
However, a further 23 per cent disclosed they had found it difficult to meet everyday expenses over the year prior.
Alongside this number, one in four respondents said they were uncomfortable with their spending habits and a quarter admitted they did not enjoy life due to their poor money management; 29 per cent said their finances most often, or always, controlled their lives, while the same number of respondents indicated they never, or rarely, had enough money to carry over at the end of the month.
Many unprepared for emergencies and retirement
Alarmingly, one in three Australians was found to have low resilience to handle major unexpected expenses; 37 per cent of respondents said they did not believe they would be able to cover major unforeseen expenses, and a further 30 per cent were found to have over one month’s worth of funds as savings on less than a quarter of the days of the year.
Worrying also was the fact that one in three Australians was discovered to be falling short of achieving their long-term retirement goals.
The research found that while current retirees, on average, are benefiting from better financial wellbeing than other Australians, the next generation is at risk of being unable to provide for their future needs.
While this finding was flagged as a major issue for Australian society moving forward, the report also found that the reality of this situation is impacting the financial wellbeing of today’s pre-retirement age Australians.
The research found that individuals who felt prepared for a rainy day and were on track with their retirement savings had higher overall levels of financial wellbeing than those who simply met everyday expenses.