Beat the top five financial stresses of 2019

This article is brought to you by ME.

Feeling the pinch of financial stress? Industry super fund-owned bank ME identifies some of the top financial concerns facing Australian households – and what you can do to beat them in 2019.

Slow wage growth

If your pay packet hasn’t changed much in recent years, you’re not alone. The Australian Bureau of Statistics says wages climbed just 2.2% over the past year¹, yet there may be a solution.

• Handy tip: A study by ME found that one of the most successful ways to boost your income is to negotiate a pay rise with your employer. According to ME, only 12% of workers take this step but with a 75% success rate, it’s worth a shot.
• Another possible solution is to invest in a union membership and reap the benefits of collective bargaining. A study released in 2017 by the International Monetary Fund (IMF)² revealed a positive link between union membership rates and rising employee income.

Low personal savings

According to ME’s latest Household Financial Comfort Report, around a quarter of households have less than $1,000 in cash savings, and it’s leaving these Australians vulnerable to unexpected bills.

• Handy tip: Take a fresh approach by putting your savings on auto-pilot. Set up a regular automatic transfer of funds from your everyday account into a savings account – even small deposits can grow into a substantial honeypot over time.

Rising power bill costs

Power bills are rising, with a report from the Grattan Institute³ saying energy bills increased by up to 20% in 2017 alone.

• Handy tip: Take the stress out of your utility bills by checking whether you could get a better deal with a different provider or a new energy plan – the savings could add up to hundreds of dollars each year⁴. Websites like free government website EnergyMadeEasy⁵ are a useful starting point to find a cheaper provider or plan.

Higher fuel prices

Motorists are feeling pain at the bowser, with the Australian Competition and Consumer Commission (ACCC) saying petrol prices have hit a four-year high⁶. This makes it important to look at ways to save.

• Handy tip: Consider selling that second car, think about carpooling, or fuel up on days when petrol prices are lower by using the wide range of free fuel price apps and websites to shop around for savings. A ME survey of 1,000 car owners revealed that Australians’ love of buying new cars is costing them tens of thousands of dollars.

Getting on to the property ladder

Rising home prices over the last two decades have made it challenging for first home buyers to get into the market. But the combination of cooler markets, notably in Sydney and Melbourne, together with low interest rates is giving first home buyers a valuable opportunity to take that first step on the property ladder.

• Handy tip: The key can be to think outside the square. A 20% deposit may not be necessary, if you’re willing to pay lenders mortgage insurance. Alternatively, consider buying with friends or family, purchasing in a less preferred area or purchasing a smaller-than-preferred property to get a foothold in the market.

Taking some simple steps today can see you beat financial stress and enjoy smooth sailing in 2019.

_________________________________________

¹Wage Price Index, Australia, Sep 2018  

²World Economic Outlook, April 2017: Gaining Momentum?

³Mostly working: Australia’s wholesale electricity market

⁴Five reasons to use Energy Made Easy 

⁵Energy Made Easy

⁶Petrol prices hit four-year high in Australia’s largest cities

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. 

Members Equity Bank Limited ABN 56 070 887 679.

The products or services being advertised are provided by third parties, not REI Super and therefore will not be the responsibility of REI Super. REI Super may invest in these third parties but does not receive any payments or commissions from these organisations as a result of members using the products and services. Members should make their own assessment and seek professional advice as to the suitability of such products or services for their individual needs.