You may have noticed that it’s officially MoneySmart Week which is the inaugural initiative of the Australian Government Financial Literacy Board aimed at improving the financial literacy and outlook for all Australian consumers. I’m a fan of this idea and anything we can do to get people more focused on improving the financial health of their families can only be a good thing. RaboDirect runs its own annual National Savings & Debt Barometer and we’ve been publicising our findings over the last few weeks urging people to take their head out of the sand when it comes to all things finance related. So if you’re one of the 46% of Aussies who has only a one month buffer of savings in the bank to tide you over then you need to check out the MoneySmart website. I honestly found it pretty shocking that our own survey showed how badly prepared millions of people are when it comes to simple budgeting, spending less than you earn and getting a regular savings habit going.
Paul Clitheroe is a key ambassador of MoneySmart Week and financial literacy is a subject close to his heart. While it’s never too late to make some positive changes to your finances if we can get kids on to it early we can help them avoid the pitfalls of previous generations. I was talking about this very issue on Sky’s Switzer show last week. Did you know that Aussies are losing out on anywhere between $3-4billion in lost interest by using transaction accounts as savings account or by choosing the wrong type of savings account. And Baby Boomers are risking their retirement and quality of life by bringing mortgages into their retirement. And to make matters worse, a large proportion of them plan to use their superannuation to pay off their mortgage!
After years of being on credit the GFC shocked people into spending less and saving more. The National Savings rate is at its highest rate in over a decade. We are still facing pretty volatile stock markets and global economic certainty. There’s no better time to spring clean your finances. MoneySmart Week is a good time to act!
Executive General Manager RaboDirect Australia & New Zealand