An emergency expense of just $1,000 would see more than a third of Aussies forced into unexpected debt, with Millennials most likely to struggle, a new survey has uncovered.
Budget Direct Home Insurance commissioned research into the financial health of Australians, which depicts a less-than-comfortable portrait of our earning and savings habits.
The data, from a survey of 1,000 people, found that less than half of Australians would be able to cover an unexpected $1,000 emergency expense with savings, with a further third expecting such an expense to put them into debt.
Budget Direct said it indicated that Australians have little to no savings set aside for scenarios such as an emergency room visit or car repair.
Older Australians aged 65-plus are the most likely to be prepared for a major unexpected expense, with 51.5 per cent indicating they could pay such a cost from their savings.
The survey also revealed that almost one in thee Australians has struggled to pay for essential items or services in the last 12 months.
These items include food, housing, utilities and healthcare.
Budget Direct said Australians aged 18-24 are the most vulnerable, with more than half of the responses from the age group (44.1 per cent) indicating that they had struggled to pay these costs in the last year.
According to the insurer, the older the respondent was, the less likely they were to report they struggled to pay for everyday costs.
The youngest age group surveyed also appeared to be the most likely to struggle financially if they suddenly lost their job and the associated income, with one in two (47.6 per cent) admitting they would only be able to cover living expenses for up to one month.
Older Australians appeared to be the most prepared in such a scenario, with 52 per cent expecting to be able to cover living expenses for longer than six months.
Even more concerningly, if their employer delayed their usual pay cycle by two days without providing notice, one in five (19.3 per cent) 18-24-year-olds indicated that they would need to borrow money.
This was the only scenario in which older Australians seemed to be less prepared than their younger counterparts, with 20 per cent of Australians 65-plus surveyed indicating a delay in pay would leave them in severe financial stress and hardship.
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