Why you should save in 2018

It’s always a good idea to ‘save for a rainy day.’

But its seems not everything thinks so. A startling in 5 Australians have zero savings for any kind of a day – rainy or not.

That’s according to research carried out by ANZ’s annual Financial Wellbeing Survey, to be released later this year.

More than 2 million Australians surveyed say they would need to borrow within a week if they experienced a sudden drop in income.

This would also have knock on effects for basic outgoings like mortgage and car repayments, food and other bills.

Save, save, save

Although this is a worrying statistic, consumers are increasingly aware of the need to save.

Building up adequate savings is one of the main financial goals for one in four Australians staring into 2018, according to a ME survey of 1,500 Australians.

However, paying off the biggest bill of all – the mortgage – was the top priority with householders growing increasingly concerned that rates will increase in 2018.

And when borrowers were asked about how they’d manage a rate rise of 1%, more than half said it would have an ‘adverse impact’ on their finances.

“Repayments could increase by $50 for every 25 basis point rise on a $400,000 loan,” said ME Money Expert Matthew Read.

“Borrowers can also help themselves by ramping up extra repayments, checking that their home loan rate is competitive, and consider locking in a fixed rate loan.”