According to the June 2017 survey, the only component of household financial comfort that is declining is ‘expectations for household’s financial situation in the next year’ – down 4% over 18 months to June 2017.
One of the key reasons why a growing number of households are expecting their financial comfort to worsen in the future is related to the ‘cost of necessities’.
Further to the cost of necessities, around a third of households expect to be worse off financially if the RBA raises the official cash rate by 1% from its record low of 1.5%, including around half of those with a mortgage.
In addition, a growing number of households are expecting their ability to manage debt to deteriorate in the future – especially if the RBA cash rate rises significantly.
Wage growth for the majority of Australians remains historically low. Around 44% of households reported their ‘income remained the same’ and over a quarter recorded their ‘income decreased’ over the past six months.
Furthermore, households reported a relatively high rate of underemployment. A significant number of part-time workers and casual employees said they would prefer more hours and full-time work.
The ME Household Financial Comfort Report provides in-depth and critical insights into the financial situation of Australians based on a survey of 1,500 households. The survey is designed, developed and produced biannually by industry super fund-owned bank ME with assistance from DBM Consultants and Economics & Beyond.
This edition presents the findings from the 12th survey, conducted in June 2017.