This article is brought to you by ME.
Australian households are increasingly struggling to repay debt despite record low interest rates, which is significant news for the real estate industry.
For average Australians, purchasing property has a profound impact on their financial security, and for most people the commitment to a mortgage will be the most significant debt of their lives.
The latest report from ME’s biannual study, the Household Financial Comfort Report, has found that of the 65 per cent of households with outstanding debt, 10 per cent expect they won’t be able to meet minimum debt repayments in the next 6 to 12 months – a twofold increase since December 2015.
The report provides valuable insights into the financial attitudes and behaviours of Australians.
Single parents reported the highest levels of concern with their ability to meet minimum debt repayments, followed by couples with young children and young singles and couples.
In terms of income, baby boomers rated themselves as the hardest hit for their savings and net wealth, causing their comfort levels to fall the most of any generation in the past couple of years.
The only work segment to experience a rise in financial comfort in the past six months (to June 2016) were full-time self-employed workers, up 4% to 5.96 out of 10.
The highest level of comfort with income continued to be reported by retirees, especially those with their main income from a superannuation annuity (6.47 out of 10), compared to retirees with their main income from the government Age Pension (5.19 out of 10).
Read the report.
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This article is brought to you by ME Bank. This information does not take into account your situation and you should consider if these products are appropriate for you. For more information, please visit www.mebank.com.au.
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