A shocking number of Australians would be immediately ruined financially if they lost their job, according to the latest research.
A survey by comparison site Finder has shown 46 per cent, or the equivalent of 5.9 million Australians, could not survive for a month if they were suddenly unable to work.
Among them, 2.1 million would run out of money within one week if their job was gone.
"That’s a very stressful way to live, knowing any unexpected expense could pull the rug from under you," said Finder personal finance spokesperson Sophie Walsh.
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“Millions of households are struggling to make it to pay day every month… We know many Aussies are putting a large amount of their pay towards essential living costs, which doesn’t leave a lot of wiggle room for an unexpected financial emergency."
The same survey of 1,780 people found only 37 per cent of Australians had enough savings for four or more months without work.
Make sure you’re not at risk. Here are four ways Walsh suggests you build up your savings:
1. Review spending
"By tracking your spending you'll have an idea of how much you can afford to put away into an emergency savings fund," said Walsh.
2. Create a budget
"Having a budget doesn’t mean you need to cut out “bad” spending. Instead, you should simply budget for it. Set yourself a daily, weekly or monthly allowance for certain expenses and then stick to it."
3. Do it together
"It could be a partner, friend, family member, or almost anyone else in the same boat as you. They can help keep you on track if you find yourself backsliding or overspending, so don’t underestimate the power of moral support."
4. Pay off debts first
"If you have credit card debt lingering it’s a good idea to focus on paying this off first before building your savings nest egg. The average credit card purchase rate is 17%, while the average online savings rate is around 0.85%, so use any spare cash to pay off your credit card debt as soon as possible."
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