Financial stress levels among working Australians has reached its highest point in a decade, AMP has reported.
The firm’s Financial Wellness report examined the state of financial stress and wellbeing among 2,475 Australians aged 18 years and over.
It discovered that levels of financial stress in the country have hit their highest point in 10 years, with just one in three working Australians (34 per cent) indicating they are financially secure. This is down from half of working participants in 2020 during the COVID-19 pandemic.
Some 42 per cent of those surveyed are experiencing mild financial stress, 15 per cent are feeling moderate financial stress, and 8 per cent are reporting severe financial stress.
AMP also found that this has arisen alongside a lack of willingness to seek professional help regarding critical financial matters.
Only one in 20 of those surveyed who are severely or moderately stressed are seeing a financial adviser, and one in nine are speaking to their superannuation fund. Nearly one-third of this cohort are turning to their family or friends for assistance in financial issues.
Moreover, one in three of participants have not used any information sources to inform their financial decision-making, despite the accessibility of podcasts, social media or a Google search.
As a result of growing financial pressures and lack of external support, many Australians are focused on meeting major short-term expenses over long-term planning. Just one in three said they are never or rarely planning for their financial futures.
“It’s clear more Australians aren’t feeling secure with their finances, not surprising given cost of living pressures and housing unaffordability challenges,” said Sean O’Malley, AMP bank group executive.
“It’s also evident that many aren’t taking advantage of the support available to them, with a tendency to bottle up their financial worries, in turn impacting their mental wellbeing.”
AMP’s report coincides with recent data from MLC, which found that 69 per cent of Australians do not feel prepared to make effective financial decisions, while only 31 per cent said they feel extremely or very equipped to make effective financial choices.
When MLC’s respondents were asked what would boost their confidence in managing these challenges, 24 per cent of Australians said they would benefit from access to financial advisers. This was up from 20 per cent in 2023.
Meanwhile, the Financial Advice Association Australia recently discovered that 90 per cent of advised clients reported feeling financially secure and tangibly better off.
The top reported benefits of working with an adviser include:
- Improved financial wellbeing and peace of mind.
- Help to understand and simplify financial matters.
- Better confidence in financial decision-making.
- Improved confidence in the ability to achieve desired standards of living.
- Help to save time/effort organising and making decisions about finances.
