Debt no impediment to happiness
Debt is no barrier to feeling good about your self, according to new research released by Australian Unity.
In fact, the Australian Unity Wellbeing Index has revealed that Australians who have a loan of more than $200,000 are often happier than people who have no debt at all or relatively modest debt levels.
According to Australian Unity head of financial planning Ross Johnston, the relative happiness of people with sizeable loans was likely to be because the money was being directed towards an investment.
“People with large loans are probably financing income-generating investments such as property, so the loan repayments are not a source of anxiety because the investment can be sold and the appreciating value of the investment bolsters future security,” he said.
Johnston said by comparison, people with small amounts of debt had low wellbeing because it was likely that their loan was driven by financial necessity and involved goods that weren’t investments.
Among the other findings contained in the Australian Unity research was that Australians were in a worse financial position in late 2008 than they were in 2003 and 2004, with many having larger loans relative to income and almost twice as many experiencing difficulty in paying off those loans.
AUTHOR
Mike Taylor
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