Gap in confidence between those who own their home and renters

New research into Tasmanians’ relationships with money paints a sad picture of the future for renters, young people and communities.

Australian cash. Picture: NewsWire / Nicholas Eagar

Most Tasmanians have debt, and a large gap in confidence about the future exists between those who own their home and those who rent, according to new research.

A report from the Bank of Us released earlier this week found almost 60 per cent of Tasmanians have some form of debt.

Of those with debt, more than 75 per cent experience debt stress.

Bank of Us CEO Paul Ranson said those who owned a home felt more financially secure.

He said there were still “a lot” of Tasmanians who didn’t feel confident dealing with money.

“In an ideal world we would have a higher level of financial literacy,” Mr Ranson said.

“That’s really a fundamental life skill to be successful.”

Bank Of Us chief executive officer Paul Ranson.

Mr Ranson said inflation had hit the hip pocket for everyone, and cost-of-living increases had impacted on discretionary spending.

“What it tells us is that a lot of people have debt that has higher interest rates, that means more of their actual income is going to repaying that debt than it was three or four years ago,” Mr Ranson said.

“What it means for a community is that people who have debt have to put more of their money into repaying that debt so they have less to spend on other things,” he said.

Youth Network of Tasmania CEO Tania Hunt said the research reinforced what young Tasmanians aged 12-25 had told her organisation.

“One of the biggest challenges that young people face as they transition to adulthood is achieving financial independence, and that is often compounded by a lack of financial literacy,” Ms Hunt said.

Youth Network of Tasmania CEO Tania Hunt at Elizabeth St Mall. Picture: Chris Kidd

“So many young people have told us they lack confidence and feel unprepared when managing their money and their financial responsibilities,” she said.

She said young people had been essentially “locked out” of the private housing market, and this was contributing to more financial stress.

“They see home ownership as a pipe dream and it’s something that’s becoming more and more unattainable for them,” Ms Hunt said.

She said young people’s financial outcomes stem both from a lack of financial education and also the fact that many young people are living below the poverty line, have insecure work and are on lower incomes than others in the community.