Recently global market research firm IPSOS prepared some ground-breaking research which lifts the lid on how Australians are living their financial and social lives, creating financial security and preparing for retirement. The research findings are quite fascinating.
The cost of being comfortable
One of the most striking findings of the research revealed how people defined a ‘comfortable’ lifestyle. Three quarters of respondents agreed that ‘having a comfortable lifestyle means having enough money to do what I want, when I want.’ But almost half are spending the entirety of their wages to pay for it- 46% admit that they live ‘pay-cheque to pay-cheque,’ including 27% of $150,000-$199,000 householders and 22% of $200,000 + householders.
This suggests that the freedom to spend at will has become the new ‘standard of living’ for many Australians, as opposed to an aspiration. Indeed, much of what is considered the norm today would have been considered ‘luxuries’ 20 or even 10 years ago. At the top on the list of the new lifestyle essentials are international travel, private schooling, technology and eating out.
If being ‘comfortable’ means being able to have ‘what we want, when we want it,’ what does it cost to maintain this lifestyle? At least $150,000 a year according to almost half (48%) of research participants. Where respondents lived, what they earned and whether or not they had dependants played a big role in shaping their attitudes, with those with kids (56%), those who live in Sydney (58%) and those on higher incomes—$150k–199k (61%) and $200k+ (75%) much more likely to believe that a minimum of $150,000 a year is needed to maintain a comfortable lifestyle.
Interestingly, while respondents were honest about their expectations for their own ‘what I want, when I want it’ lifestyles, they took a far more conservative approach when asked to consider how we live as a ‘society.’ The overwhelming majority (85%) believed that people nowadays live beyond their means. Strikingly, 90% of those who believe ‘having a comfortable lifestyle means having enough money to do what I want when I want’ also think that ‘people nowadays live beyond their means,’ which further suggests the complex relationship between how we view our own behaviour versus the behaviour of others or society as a whole.
Our priorities and aspirations for the future
So if being ‘comfortable’ is at the heart of our expectations for how we should live, what else do we value? The research findings reveal that, despite our love of lifestyle and soaring property prices, owning your home is still the great Australian dream, with this ranking as the number 1 priority (78%). Fascinatingly, being able to live off one income came in at number 2 (73%), suggesting that this is now perceived to be something of a ‘luxury’ in an era defined by the busy, ‘time poor’ double income household.
When it comes to goals for the future, maintaining standard of living and paying off the house (mirroring current priorities) were ranked as the most important. So too does an early retirement, more frequent international travel and home renovations (also mirroring current priorities).
Source : IPSOS Australia Today research