Champagne problems: The luxuries Aussies can no longer afford
Australians are going without everything from prosecco to private health insurance as cost of living pressures persist, according to new research by Finder.
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A Finder survey of 1,012 respondents revealed more than 1 in 2 (54%) – equivalent to more than 11 million people – admit the cost of living has had a negative impact on their lifestyle.
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The research found 1 in 3 (33%) have cut back on eating at high end restaurants, while 27% have gone without drinking expensive alcohol to curb their spending.
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One in four (25%) have stopped staying at five-star hotels, while the same proportion (25%) no longer buy designer clothes as living costs bite.
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Cutting back on beauty treatments (21%), downgrading travel (16%), and sacrificing gym memberships (15%) are other luxuries Australians are giving up for the sake of their bank account.
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But it's not just luxuries on the line – a whopping 8% have downgraded from gold private health insurance to a lower tier to combat rising expenses.
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Sarah Megginson, personal finance expert at Finder, said rising prices and interest rates are forcing Aussies to change how they live.
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"Prices of nearly everything are far higher than before the pandemic and some are having to make drastic lifestyle changes to cope.
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"Aussies have been forced to become more budget-conscious with their spending habits and little luxuries they once enjoyed are now on the chopping block."
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Gen Z (69%) and gen Y (66%) were more likely to say they've made sacrifices to cope with financial pressures than gen X (48%) and baby boomers (36%).
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Megginson said cutting back on luxuries is the definition of a 'champagne problem', while many households are struggling to afford food and rent.
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"There's a much more harsh reality for some people than cutting out their weekly pamper sessions.
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"Now more than ever, it's crucial to direct any lifestyle savings to a high interest savings account.
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"Savings rates have increased significantly over the past two years and savers are getting much more bang for their buck.
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"If you create a savings habit during tough times, even if it's as little as saving $5 a week, you're much more likely to continue those good habits in the future, which could add up to serious wealth down the track," Megginson said.
| Have you cut back on any of the following luxuries due to the cost of living? | |
|---|---|
| Eating a high end restaurants | 33% |
| Drinking expensive wine and other alcohol | 27% |
| Staying at 5 star hotels | 25% |
| Buying designer clothes/accessories | 25% |
| Getting beauty treatments (e.g. facials, manicure and pedicure) | 21% |
| Flying first/business class | 16% |
| Cancelled an expensive gym or pilates membership | 15% |
| Getting botox/filler/other plastic surgery | 11% |
| Downgraded from gold private health insurance | 8% |
| Other | 2% |
| None of the above | 46% |
| Source: Finder survey of 1,012 respondents, May 2024 |
Methodology
- Finder's Consumer Sentiment Tracker is a monthly recurring nationally representative survey of more than 60,000 respondents.
- Figures in this release are based on 1,012 respondents from May 2024.
- The Consumer Sentiment Tracker is owned by Finder and operated by Qualtrics, an SAP company.
- The survey has been running monthly since May 2019.
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