Almost half of young Aussies struggle to save – about one-in-six don’t have emergency funds

Almost half of young Aussies struggle to save – about one-in-six don’t have emergency funds

Largest ever money survey of Gen Z and Millenials – more than 50,000 polled – unveils youth sentiment towards money habits and cost of living crisis

  • New data by digital bank Up shows almost half of Gen Z say they are overspending on the “good life”, including going out and shopping, preventing them from reaching their financial goals.*
  • The rising cost of living crisis is the biggest blocker (39%) for Millennials, Gen X and Boomers when it comes to reaching their financial goals. Followed by overspending.*
  • Queensland was the state with the highest proportions of people (20%) with no emergency fund at all.
  • The digital bank has launched an Australian-first financial product, Hi–Fi by Up
  • Hi–Fi is an automated financial system for managing your money that aims to help tackle this problem.

Australian digital bank Up has today released the largest ever survey of Gen Z and Millennials (54,161 Aussies polled), which reveals youth sentiment towards finance and saving, Australia’s cost of living, and their overall money management habits.

The report, Sound Check, is compiled from hundreds of thousands of data points (over a two-week period in October/November 2023) and is available as a result of Up’s newest feature, Hi-Fi – a personalised financial system for Aussies that puts money on auto-pilot.

Designed to get Upsiders to reflect on different facets of their financial wellness, Sound Check reveals Aussies their Hi-Fi Score – an indicator of how Aussies are doing and feeling when it comes to savings and money management.

The Current State of Play Across the Country

Interestingly, the data showed on a location basis that about one-in-four (26%) of Australians residing in NSW, VIC and the ACT were prepared for large unexpected events and expenses. When it comes to emergency funds, QLD and NT lead the charge as the states with the highest proportion of people (20%) with no emergency fund at all.

What’s Stopping Gen Z and Millennials from Getting Ahead

Almost half of all respondents (41%) blame themselves for their poor saving habits. They cite “overspending on the good life”, including going out and shopping, has prevented them from reaching their financial goals and going further with their money. The second most popular reason was the “high cost of living”, cited by 35% of all respondents. For Gen Z, “overspending” was the primary reason, with 46% compared to only 27% of Baby Boomers. On the other hand, 44% of

Baby Boomers pointed at the “high cost of living” as the main factor for this, compared to only 31% of Gen Z.

Up’s Chief Product Officer Anson Parker said, “With homeownership feeling out of reach for many young Aussies, there may have been a shift in focus. Young people might be putting their savings towards making memories and experiences in order to enrich their life. Upsiders are setting up saving goals for everything from travel, to eating out or putting their money towards a big life experience.”

That being said, almost a third of Gen Z (28%) and Millennials (24%) claimed that they rarely have money left over before pay day, whereas 28% of Boomers always do.*

Who’s Coming Out on Top

When it comes to financial happiness, almost half of Aussies say they find it mostly easy to cover basic living costs, with Gen Z and Millennials leading on 76% and 75.5%. Although it appears Millennials are not feeling the pinch when it comes to everyday essentials, with a third (33%) stating that it was super easy covering those costs.*

Future Gazing

When it comes to future money, over half (52%) of Aussies have made a start on their savings and are feeling okay to provide for their future needs. Baby Boomers are the most prepared at 61%, while Gen X are furthest behind (with only 48% reporting feeling okay about their future). On the flip side, over a third (38%) of all respondents indicated that their future savings are not looking good, with Gen X impacted the most at 42%, followed by Gen Z and Millennials at 38%.*

To help Australians navigate through pay days with confidence and boost their saving habits, the digital bank has revealed the future of money management with its new feature, Hi-Fi.

Up’s Chief Product Officer Anson Parker says the new money management system couldn’t have come at a better time, especially with young Australians now more than ever knowing the importance of financial literacy. The launch of the nifty new feature allows Aussies to set themselves up for better financial success ahead of the new year.

“At its core, Hi–Fi by Up has been designed to make money easy. It’s an Australian banking first – and it will allow Aussies to cruise between pay days, take care of their bills and hit their budgeting goals with ease. Equally as important, it will allow them to comfortably know how much they’re due to have left over at the end of each payday so they can spend (responsibly) on the good life.”

“Our data has now uncovered that since signing up to Up, over two thirds of our customers have a better relationship with money. Gen Z leads the pack at 77%, followed by Millennials at 72%.* This just shows how our unique innovative thinking and features have helped uplift their financial wellbeing,” says Parker.

How Aussies Score

Sound Check gives those who complete the survey a Score. The Score combines a person’s responses to the survey to give Aussies a number they can track against each quarter. The median Score overall was 55, with Boomers feeling happiest about money, and Gen Z feeling the worst.

However, Millennials and Gen Z were the most optimistic, with the majority reporting their feelings about money are on the rise.

When it comes to the median High-Financial Wellbeing or Hi-Fi score for each generation, Gen Z recorded 55 out of 100, Millennials 60 and Gen X on 55. Baby Boomers came up on top of financial-wellbeing, with a median of 65 out of 100.*

The software solution has been informed by data from hundreds of thousands of customers and millions of transactions since Up’s inception five-years ago.