Surveys of spending intentions and analysis of payments data are showing a clear pattern of restraint among younger Australians.
Earlier this week American Express unveiled research conducted into the spending and saving intentions of 1,500 Australians aged between 24 and 35 years.
Although more than half of those surveyed (55 per cent) said they strive to find the right balance between short-term desires and long-term financial goals, 58 per cent claimed to have a good or excellent understanding of money management and 42 per cent don't spend beyond their means.
Amex suggested this assertion was backed up by data showing 57 per cent have savings set aside, while 41 per cent also maintain a budget as well as track their spending. Further, when making a retail purchase, 47 per cent only buy new things that they feel they actually need.
Nevertheless, some spending was being factored in: 62 per cent said they consider spending money on themselves as a form of self-care. Around half of the survey group admitted they give themselves 'little treats' on a weekly basis such as eating out (60 per cent), purchasing a new piece of clothing (47 per cent) or ordering a takeaway drink (45 per cent).
These fluffy survey-based numbers are reinforced by the monthly CommBank Household Spending Insights Index for July – based on de-identified payments data for June from approximately 7 million CBA customers – which was also released this week.
The CommBank HSI shows that spending was up for the month, driven primarily by increased spending on Recreation (+3.2 per cent) and Hospitality (+2.1 per cent).
The CBA report for June also highlights significant spending differences across home ownership type. Renters continue to be challenged, with spending declining 0.9 per cent in the year to June compared with spending increases for those with a mortgage (+1.5 per cent) and outright owners (+2.1 per cent).
"We have witnessed a significant disparity in spending behaviours across home ownership categories, as renters pull back on spending in the year to June while mortgage holders and outright owners have increased spending," said Stephen Halmarick, CBA chief economist.
"This suggests younger Australians, who are more likely to be renting are tightening their wallets and likely spending more on essentials, given these are the fastest growing spending categories so far this year."