Amount you need to make to be above Australia’s poverty line

Millions of Aussies are falling below the poverty line as the cost of food, petrol, rent and power soar. Here’s how much you need to make to stay above water.

With cost of living on the rise, everyday Aussies are feeling the heat as millions are pushed into poverty.

On Tuesday, the Reserve Bank of Australia announced another 0.5 per cent jump in the interest rate spelling more bad news for renters, mortgage and debt holders.

But for Australia’s lowest income earners, Australian Council of Social Services (ACOSS) Deputy CEO Jacqueline Phillips says the combined impact of national crises like the east-coast floods and global pandemics and wars, continues to drive millions of Australians into poverty.

Jacqueline Phillips deputy CEO of the Australian Council of Social Services (ACOSS) says millions of Australians are trapped under the poverty line. Picture: Supplied

“When inflation is high, everyone pays the price, but research suggests that lower-income households suffer the most,” Ms Phillips said.

“Typically, food and petrol and housing costs make up a much bigger share of total spending for lower-income households than for higher-income households.

“We’re also seeing a big increase in the numbers of people needing to seek some form of emergency relief – for instance we’ve seen over a million people coming to food banks around Australia as prices soar.”

The Organisation for Economic Cooperation and Development (OECD) defines the poverty line as half the median household income of the total population.

Ms Phillips said compared to other OECD nations, Australia had relatively high poverty rates.

A 2020 report found 3.34 million people were living below the poverty line – more than one in eight adults and one in six children.

Australia’s relatively high poverty rates mean one in eight adults and one in six children are lving in poverty.

And with a pandemic-induced housing affordability crisis considered the fastest growing cost of living issue, the number of Australians trapped in poverty has only been rising.

Any single adult earning less than $457 per week or a couple with two kids earning less than $960 per week would be living in poverty.

“Nationally, we’ve been seeing regional rent increases of 18 per cent over the last two years, dramatically outstripping any increases to the Commonwealth Rent Assistance, and ACOSS is concerned that people are now facing the double whammy of evictions due to rent rises in addition to the increasing cost of living more generally,” Ms Phillips said.

“We are worried about people who’ve been forced to live in their car and families who now live in a tent – that is the reality of what’s happening … and food is definitely becoming a discretionary item for people with the least.”

The soaring cost of daily essentials have forced many Australians to make tough budgeting decisions.

New research from Savvy found that the average disposable household income – that is how much money you keep once tax is deducted – was $1,124 per week.

But with 75 per cent of households facing debt, one in four Australians are struggling to stay afloat amid increasing cost of living pressures.

“Those getting by on $46 a day – who were already struggling to cover the basics – are now facing a long and extremely difficult winter with even more impossible choices to make,” Ms Phillips added.

“We are hearing of people who are limiting their showers to every second or third day, turning off the heater to save on electricity bills, skipping meals to make sure their children can eat.

“Rising interest rates and the risk of landlords passing these costs onto renters is yet another blow to those already experiencing the impossible housing market.”