A new study has found that nine out of 10 Australians say they are struggling to manage their household budget in the face of the rising cost of living.
A survey by consumer group Choice, published on Thursday, found that 90% of more than 1,000 participating households said their bills had risen since 2021 – with the heaviest financial burdens being health insurance and utilities.
Choice editor Marg Rafferty said nearly all Australian households were feeling the pressure of price hikes, with the report highlighting how difficult it has become to manage household budgets.
“Health insurance and utilities are among the biggest financial burdens, according to research,” she said.
“Cost of living pressures continue to be a major issue for Australians.”
Almost three in five respondents raised concerns about their disposable income, with impulse data revealing that 23% of households are struggling to cope, up from 18% in June last year.
Ms Rafferty gave advice to Australians struggling to pay their bills, saying ‘there’s a chance you’ll get a better deal elsewhere’.
“Our research shows you can save up to $935 per year on hospital coverage by switching to a similar policy from another provider.” she says.
“It’s always worth spending time comparing what’s on the market.”
According to the Australian Bureau of Statistics, household spending in June was up more than 10% from the same period last year.
But hikes in household bills aren’t the only thing Australians are spending their money on, with residents feeling the pinch of a further 15% rise on services and 5% on goods.
The monthly figures, which were released on Tuesday, showed that discretionary and non-discretionary spending increased following a 6.1% inflation rate.
Non-essential spending rose 10.8%, driven by spending on recreational and cultural activities, while essential spending rose 9.8%, driven by higher transportation costs.
The largest spending sector was transportation, up 22.7%, due to higher gasoline prices due to the ongoing war in Ukraine and demand for air travel.
Spending on hospitality businesses like hotels, cafes and restaurants rose 17.1% in what is seen as a positive return to pre-pandemic levels.
There was also strong growth in spending on clothing and footwear – up 16.3%, along with a 15.5% increase in leisure and culture.
Jacqui Vitas of the Australian Bureau of Statistics said June marked the 16th consecutive month of year-round increases in total household spending.
“This is explained by steady declines in total household spending from March 2020 to February 2021, as responses to Covid-19 were felt across the country,” she said.
“The spending categories most affected by Covid-19 responses – transport, hotels, cafes and restaurants, clothing and footwear – have now returned to pre-pandemic levels.”