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How the EU crisis affects Aussie generations

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Category Finance News

The European financial crisis has seen ups and downs in the market for the past three years, yet Australians are still unsure how these European issues affect them. Are the only people being affected the Europeans themselves? If not, what are the implications for everyday Australians?

Take a look at how the different generations see the crisis:

Gen Y

Danielle, a Gen Y fashion worker in Sydney, says she hasn’t noticed anything but positive effects from the uncertainty in Europe.

“I guess it’s affected me in a selfish way more than anything,” she says. “You wouldn’t think online shopping would be cheaper, but it has been ”“ sales pop up from different stores and I’m always really keen to look for savings.”

Australia’s lower central bank cash rate and low interest rates (often attributed in part to the uncertainty in Europe) could also be having an effect on Danielle’s week-to-week savings.

“Getting a home loan a couple of years ago stopped me from doing a lot of traveling in the past. But I just booked flights to Europe later this year and they were a lot cheaper than I have seen before. It’s nice that interest rates have stayed low.”

Gen X

Gen X hospitality worker Joel hasn’t noticed a negative impact of the European crisis in his personal life, but has seen some changes professionally.

“All I know is the price of certain products has come down a long way,” he says. “People are quick to point out any rising costs, but people in the hospitality game would have seen olives and olive oil for example come down dramatically in price. There has also been plenty more wine to choose from. I actually think we’ve been spoilt for choice.”

However, Joel says he’s unsure of whether to expect any negative impact in the future.

“I guess we’re looking pretty healthy compared to the rest of the world, but we’re not completely immune. Hopefully we’ve learned enough from their financial mistakes to ensure it doesn’t happen here.”

Baby boomers

Baby boomer and newly self-funded retiree Rob has his super paid fortnightly, indexed to the cost of living. His wife’s benefits are at a set rate.

“My only concern is that these events going on in Europe do have an impact on the cost of living here,” he says. “You just don’t know. Costs have been going up, as in electricity and water. Why are they spiking all the time? If companies have investments in other places and are uncertain about their returns elsewhere, of course Australian consumers are being hit.”

Rob says this type of rising cost is most concerning for self-funded retirees.

“Cost rises are going up more than the usual cost of living. If you’re getting X amount from your super fund and your costs keep rising, you have to cut other areas to make ends meet.

“When the share market gets jittery, you have so many ups and downs. Everyone is so concerned that if Greece goes to the wall, the big banks will lose money. Depending on where you have shares, that can be quite concerning. For people who have little parcels of shares, there’s some uncertainty that makes moving towards retirement feel a little bit uneasy.”

However, apart from that uncertainty and a volatile share market, Rob says it’s hard to identify how the rest of Australia is affected.

Whether you feel directly affected or unsure of what all the noise is about, Australians are striving to understand what has been happening in Europe. You can feel powerless against any crisis, or you can monitor your finances to protect yourself.