Australians less anxious heading into Christmas but Choice warns on credit overindulgence
Posted
A consumer behaviour survey shows Australians are slightly less anxious heading into Christmas this year, but advocacy group Choice warns shoppers against overindulging on credit during the festive season.
NAB's Consumer Anxiety Index has fallen to a new survey low of 58.7 points in the fourth quarter, compared to 61.1 this time last year, as lower stress from government policy, health spending, costs of living and job security buoy sentiment.
However, despite this, NAB said its consumer spending indicator showed concerns over people's current financial position continued to grow.
Spending on non-essentials such as entertainment, eating out and major household items remained conservative, more so than last year across all types of spending, except for the use of credit, the survey found.
"Our living costs are still considered to be the biggest driver of consumer anxiety, but we are continuing to see encouraging improvements," the report noted.
By gender, the report found anxiety remains higher for women, especially those aged between 30 and 49, while on a state-by-state basis, anxiety was highest in Victoria, followed by New South Wales.
Overall, consumers were most worried about financing retirement, providing for the family's future, health expenditure and the ability to raise emergency funds.
Christmas credit crunch
Meanwhile, with Australians still often pulling out the plastic, a survey by consumer advocacy group Choice has found Australians between 30 and 49 are more likely to live off credit cards if they run out of money before pay day.
According to ASIC, Australians owe $32 billion on their credit cards, which equates to $4,300 per card holder.
There are 7.5 million credit card holders in Australia, and the average card holder pays $700 in interest per year, if their interest rate is between 15 to 20 per cent.
Choice said its latest survey has found just one-in-four households say they are living comfortably.
"In the next 12 months, a majority of people say they are planning to cut back on discretionary and non-essential purchases - everything from holidays, big ticket household items, alcohol, entertainment and clothing," said Matt Levey, acting chief executive at Choice.
A third of people under 30 have dipped into savings in the last year to make it to pay day, while a quarter had borrowed money from family or friends, and 20 per cent of people aged 30-49 say they have deliberately missed the due date on a bill.
"While there is no shortage of encouragement to spend up big, we would encourage Australians to take it easy this holiday season and try to avoid waking up with a new year credit card hangover," said Mr Levey.
Topics: consumer-finance, consumer-protection, business-economics-and-finance, australia
