Debt spiral hits one in five
(12 April 2011 – Australia) Veda Advantage’s bi-annual Australian Debt Study revealed one in five Australians struggle to repay debt, with more cutting back on groceries to make ends meet.
The survey said 21 percent are finding it tough to repay debt, up from 19 percent six months ago and two percent were unsure how they would make their next repayment.
Those who want to apply for more credit are high quality applicants, with NSW and WA among the leading states, and those on higher family incomes.
Veda Advantage head of external relations Chris Gration said Australia’s debt situation was relatively stable overall.
'The debt study shows most Australians are acting financially responsibly. The anxiety around future ability to repay bills remains high at 77 percent, however this has reduced significantly from 82 percent over a year ago.
As many as 14 percent of Australians surveyed said they had missed a minimum bill repayment in the past three months, an increase from 12 percent of people 12 months ago.
Most (82 percent) Australians have cut back on everyday/ lifestyle spending at some time to pay their debts.
The number of people who have had to cut back on buying groceries rose over the past six months, from 43 percent 12 months ago to 47 percent.
One in four had to turn to friends or family for assistance over the past year, which was down from one in three in September last year.
'Despite this sober approach, almost three in every ten Australians who are looking to take on more debt are already in a position of financial hardship and this is concerning.
"The introduction of positive credit reporting is vital to help those living on the financial fringe avoid a situation where cannot repay their debts. The Government needs to act quickly to prevent more Australians falling into a debt spiral,' Mr Gration said.
Those who want to apply for more credit are high quality applicants, with NSW and WA among the leading states, and those on higher family incomes.
Veda Advantage head of external relations Chris Gration said Australia’s debt situation was relatively stable overall.
'The debt study shows most Australians are acting financially responsibly. The anxiety around future ability to repay bills remains high at 77 percent, however this has reduced significantly from 82 percent over a year ago.
As many as 14 percent of Australians surveyed said they had missed a minimum bill repayment in the past three months, an increase from 12 percent of people 12 months ago.
Most (82 percent) Australians have cut back on everyday/ lifestyle spending at some time to pay their debts.
The number of people who have had to cut back on buying groceries rose over the past six months, from 43 percent 12 months ago to 47 percent.
One in four had to turn to friends or family for assistance over the past year, which was down from one in three in September last year.
'Despite this sober approach, almost three in every ten Australians who are looking to take on more debt are already in a position of financial hardship and this is concerning.
"The introduction of positive credit reporting is vital to help those living on the financial fringe avoid a situation where cannot repay their debts. The Government needs to act quickly to prevent more Australians falling into a debt spiral,' Mr Gration said.
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