Despite the recession first hitting in 2008, and many areas of the world showing tentative signs of recovery, the situation in Australia continues to worry many people with more of us than ever cutting down on our expenditures at every available opportunity. The situation for many of us is still less than optimal and few of us are feeling financially secure in our lives. However, some people are arguing that we need to be stimulating spending if the economy is to recover and that while we need to save we also need to spend.
Interestingly a recent article in the Sydney Morning Herald brought home the realisation that more and more of us are suffering financial distress now than we were in the first few years of the recession. The article focused on the results of a consumer survey run by the Boston Consulting Group which found that “47 per cent of Australian consumers felt they were in financial trouble or not financially secure” and found that “50 per cent of Australians [are] saying they intended to spend less on discretionary items.” These findings make Australia one of the developed countries with the least consumer confidence in the world. Despite having seen a much less turbulent recession than many regions including the US and EU Australians are still feeling intense financial pressure.
Having such low consumer confidence and more of us turning to savings has an interesting effect on the country. At the primary level it helps individuals keep afloat but at the same time it exacerbates many of the problems facing companies and businesses as people continue to not spend or scrimp wherever they can. This means that the economy continues to struggle as consumers shy away from any spending they don’t deem absolutely necessary. In many ways this is adding additional pressure on jobs and individuals well-being but understandably individuals still need to be paying the most attention to their own savings and expenses.
More and more of us are continuing to save as much as we can as a buffer against continuing economic problems and with such a large percentage of the population feeling financially insecure it seems appropriate that we continue to hedge against the economic situation. By saving e can create a buffer against further economic woes and secure a more stable financial future for ourselves. We all need to save; whether for a house, retirement or other needs and it makes sense in the current economic climate to do so.
When it comes to savings though we need to be careful how and where we store our money as unless our money is actively working for us it may be better utilised elsewhere. Savings and deposit accounts are the core places we can store our money if we don’t have thousands of dollars to invest according to http://www.bankwest.com.au/personal/savings-term-deposits/savings-term-deposits-overview.
When it comes to saving it seems we will all continue to do so and it makes sense at the moment to have readily accessible funds at your disposal. However, as a final note we should say that our situation is slowly improving and we shouldn’t, necessarily, be saving at the expense of other things we need or enjoy.