The Commonwealth Bank (CBA), which boasts the largest pool of bank account data in Australia, has unveiled fascinating insights into how Australians’ earning, spending, and savings habits have evolved amid rising interest rates and inflation.
As illustrated in the graph on the left, the average CBA household experienced an income growth of 5.0% over the year to June 2024. This increase was primarily driven by higher salaries, alongside a significant jump in income earned from rental properties and other investments.
Conversely, the graph on the right reveals that spending, excluding rent and mortgage costs, rose by just 3.1% year-on-year. However, housing costs grew at a much higher rate, exceeding 10%.
“Average savings remain higher than 2019 levels, before the pandemic,” notes CBA. “However, there is evidence that some of these excess savings have been utilized over the past year.”
Additionally, CBA reports that “both average loan repayments and average rent payments have risen sharply in recent years. The substantial increase in interest rates since May 2022 has caused average mortgage payments to outpace rent payments. With continued rental growth and fixed-rate rollovers, this trend is expected to persist through 2024.”
These insights highlight the evolving financial landscape for Australians, emphasising the impact of economic factors on household financial behaviour.
