While the Consumer Price Index has begun falling in the rate of growth from its 30-year high reached in December 2022, inflationary conditions and other macroeconomic pressures continue to place pressure on household budgets.
- CBA survey shows 22% of Aussie households can 'just' cover expenses while 5% are encountering a shortfall.
- Aussies are reallocating almost $450 per month to goods, services, or savings pots.
- Many consumers have reviewed how they shop, with a majority (73%) relying on promotional codes, cashback offers, and rewards.
The latest CommBank Consumer Insights report revealed over one in four (27%) of Australians have not enough, or just enough, money to meet household expenses.
A further 46% have a little left over after paying their bills, while only 27% say they live comfortably.
This comes as data from the Suicide Prevention Australia Community Tracker found 56% of families felt more distressed than normal due to the cost of living crisis in the September quarter.
Irrespective of their financial situation, Australian consumers are redirecting $448.40 per month on average towards essential goods and services or savings.
Macquarie University Professor of Marketing and Consumer Behaviour Jana Bowden said consumers are learning to prioritise needs over wants.
“We are now in an era of cost-conscious consumerism, and fear drives the new consumer psyche,” Ms Bowden said.
“Consumers are no longer thinking simply about what to buy.
“They are reassessing what, how, when, where and why to buy across all categories - from milk to motor vehicles.”
Australians adopting deal-seeking behaviours
Of the 5,279 survey respondents, nine in 10 are making new lifestyle choices that impact their spending and shopping habits.
This includes using promotional codes, cashback offers and rewards (73%), spending more time researching before buying (66%), and only buying from businesses they know and trust (47%).
A pullback in discretionary spending is also evident including having fewer nights out, 65%; less takeaway food and drinks, 62%; and changing holiday plans to fit a smaller budget, 46%.
Despite the cost of living pressures, more than half of consumers feel optimistic about the next 12 months.
However, even as cost of living pressures subside, many indicate that recently adopted behaviours, such as the above, will persist.
"Almost a quarter of Aussies are falling short of meeting household expenses" was originally published on Savings.com.au and was republished with permission.