The firm published the findings of new research conducted alongside demographer Bernard Salt, designed to gauge attitudes towards wealth generation among ‘middle Australia’ (the middle 80% of the wealth distribution).
According to the analysis, wealth was no longer defined by the ‘great Australian dream’ of home ownership, but instead perceived as the “freedom to pursue passions and support those we care about”.
The research — which drew from demographic data and analysis from the Australian Bureau of Statistics (ABS) — found home ownership rate peaked at 73% in 1966, steadily declining to 63% today.
Marrying and having children later, higher rates of divorce, and increased life expectancy, underpinned the shift, which has reportedly resulted in a “more individualised view” of wealth.
According to AMP, increasing life expectancy, greater workforce participation by women, the superannuation system, the rise of apartment living, globalisation, and the recent COVID-19 pandemic, had also driven the shift.
“Our singular focus on home ownership in the middle of the 20th century delivered a sense of security to returning diggers whose childhood was spent navigating the travails of the Great Depression,” demographer Bernard Salt said.
“Getting married, having kids, buying a house, holding a steady job were values that shaped the times.
“Whereas current day Australians have a range of objectives which includes home ownership, it also includes the pursuit of options like how and where we work, in how and when we form relationships and in how we choose to live our lives. Many of these things have changed dramatically since the 1960s.”
However, unchanging were the attitudes towards the value of health, of personal relationships, family, provisioning for children, and helping grandchildren.
“These things are eternal. They are human. This is the reason why we pursue security through wealth and why we have pursued these things in the past,” Salt added.
“Wealth however grand or modest enables us to live the lives we want to live, to benefit those we love, to support those we care about, both now and into the future. That is what it means to be ‘wealthy’.”
Reflecting on the research, AMP CEO Alexis George said Australians were “no longer anchored” to home ownership.
“Modern day wealth requires us to consider what our goals are and to put a financial plan in place. The earlier we do this, the more likely we are to achieve those goals,” George said.
“The challenge is that despite Australia having one of the world’s highest GDPs, a resilient economy and a strong education system, we know that financial literacy is poor, and financial advice remains out of reach for many.
“Improving financial literacy, offering greater access to financial advice, retirement and other investment solutions are key ways financial services organisations like AMP can help Australians engage more with their finances, so that they can achieve the wealthy they want.”
