What are your finanical goals in 2017?
OVER a quarter of Australian households will be savings for a holiday or car in 2017, closely followed by paying off a mortgage and building up 'rainy day' savings.
But many may fail to achieve their savings aspirations, according to new ME research with 1,500 Aussie households, which unearthed a number of ineffective savings habits:
- 53% fail to set a weekly or monthly budget
- 35% rarely stick to a budget or spending allowance
- 59% do not keep a written or electronic record of monthly expenses
- 42% fail to pay off their credit card each month
ME Head of Deposits and Transactional Banking, Nic Emery said a lack of money discipline is holding many Australians back from realising their financial goals.
"The key to getting ahead is tracking the real costs of your household expenses, setting a realistic budget and committing to every single detail, consistently," he said.
"For some 'live-for-today, plan-for-tomorrow' types regular savings habits may not come naturally − if you're one of these people, consider introducing processes such as automatic transfers that helps you set, forget and save."
According to ME's research, only 21% of households set up automatic transfers to a savings account. Others prefer to:
- Transfer money to a savings account when spare funds are present (52%).
- Put money into a savings account and then transfer it to an everyday account when needed (19%).
- Keep savings in accounts they can't withdraw from (e.g. term deposits) (17%).
- Just accumulate funds in an everyday account (15%).
- Add funds to a home loan offset account (11%).
Top 10 financial goals for Australian households in 2017:
- Saving for a holiday, car or other expense other than a home (26%)
- Paying off a mortgage (25%)
- Building up 'rainy day' savings (25%)
- Paying off debts as fast as you can (24%)
- Building wealth for retirement (18%)
- Setting up a budget or a savings plan (17%)
- Getting debts under control and manageable (15%)
- Saving enough to buy a property to live in (11%)
- Buying an investment property (9%)
- Investing or trading in shares, bonds, commodities, etc (9%)