One in five Australians have less than $1000 in their bank account

With just four weeks to go until JobKeeper payments end, new figures reveal one in five Australians have no cash savings and are living week to week.

Many households have been hit hard during the pandemic and concern remains for many once JobKeeper payments end.

One in five households have no cash savings and concern remains how many struggling Australians will cope once JobKeeper payments end.

With just four weeks to go until the Federal Government’s financial subsidy stops, in lender ME’s latest biannual financial comfort report it showed many households have little or no cash savings to fall back on.

The report surveyed 1500 households and found about one in five households have less than $1000 in the bank.

Of the households battling financially, many blamed job changes and impact to their wages as hitting their hip pockets hard.

Jeff Oughton. Picture: iStock.

The report’s author, consulting economist Jeff Oughton, said despite many Australians stashing money during the pandemic there was still a large contingent with no cash reserves.

“There’s still 20 per cent of people who spend every dollar every week just to get by,” he said.

“And there’s another 20 per cent who have less $1000 in the bank and then 8 per cent that have less than $100 in the bank.”

The report also showed about one in two people expect it would be difficult to find a job in two months’ time.

Financial adviser Scott Haywood said when JobKeeper ends in four weeks “a recession is about to hit”.

“People have been cushioned through the government stimulus and not everyone who is on JobKeeper is going to be able to keep their job,” he said.

“It’s not just going to be a case of everyone going back to work.”

Financial adviser Scott Haywood. Source: Supplied.

He urged employees to talk to their employer immediately to work out what their situation is once JobKeeper ends.

Nearly one million Australians were still receiving JobKeeper payments at the end of January.

The report also showed many owner occupiers were optimistic about their house price in the next 12 months. About 46 per cent expect there to be rises.

And investors too are hopeful of capital growth – two in five investors expect the value of their properties to rise in the next year.

The report found mortgage stress has fallen – 37 per cent of borrowers felt strain on their hip pockets, the lowest level in three years.

Record-low interest rates, government income support and the deferral of loan repayments has helped contain mortgage stress.

The Federal Government’s JobSeeker payments are set to rise. Recipients on what was previously known as Newstart will receive an extra $25 a week.

This will boost their payments to $307 per week from April.

However it will be less than what recipients are getting now because coronavirus supplement added onto JobSeeker payments at $150 a week will stop at the end of next month.

@sophieelsworth

Originally published as One in five Australians have less than $1000 in their bank account