Yahoo Finance Most Aussies score only 48% on this money test: Can you beat them?
As interest rates reach record lows, volatility returns to global markets and household debt teeters at massive highs, it’s an important time to be confident about your finances.
But according to comparethemarket.com.au’s annual financial consciousness index (FCI), developed by Deloitte Access Economics, the average Australian scores 48 out of 100 on the financial consciousness test.
Scores of less than 35 points means you “don’t know what you don’t know”, while scores from 35 to 45 mean you consider finance “a blur”.
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If you score 45 to 55, it means you’re financially conscious, and if you score 55 to 70, you’re “rising up the ranks”.
But if you scored 70 and above, you’re part of the 5 per cent who are “savvy and enlightened”.
Generation Z Australians (aged 18 to 24) scored an average 44 out of 100, down from 46 last year, with 32 per cent relying on government benefits in financial difficulty. And 16 per cent say they struggle to pay their bills on time.
“There is a clear relationship between people’s FCI score and their overall financial wellbeing and sentiment,” comparethemarket.com.au general manager of banking Rod Attrill said.
“Our survey results clearly indicate that there is a tendency of Gen Z to struggle with money management day to day and it’s the unfortunate truth that the younger generations aren’t taking the time to review their financial plans or keep a close eye on where their pay cheque is going.”
He said just one hit to the economy can have a major impact on Australians financial security.
“With a continuation of flat-lining wages, lack of job security and ever increasing cost of living, more and more younger consumers are struggling to meet their financial goals and maintain a comfortable lifestyle compared to last year,” said Attrill.
“Even managing simple expenses such as paying monthly bills is becoming an all too difficult chore, with feelings of financial security plummeting.”
Interestingly, Australians over 70 had the next-lowest score after Gen Z, coming in with 47 ouf of 100. Australians 45 to 64 all scored an average of 50, with every other group scoring lower.
“Those under the age of 25 in particular need to take better control of their financial circumstances and try to find the gaps in how they view and use money,” Attrill said.
“Whether it’s saving more regularly at the end of each month for big ticket items such as a house deposit, or start budgeting more often to watch where each pay cheque is going, these small changes to our money habits can make a world of difference and help achieve a more financially independent lifestyle.”
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