Wednesday, 05 April 2017 02:44

Spending more than they earn hurts Aussies

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Many Australians are spending more than they earn each month, with new research revealing that overspending is impeding their progress towards achieving their financial goals.

The research, by the Commonwealth Bank, found that about 46% believe they are not progressing towards their financial goals and just as many — 45% — of Australians are uncomfortable with their current level of spending.

The data also indicated more than half (56%) of people would not have enough savings to handle a temporary loss of income and one in three Australian households would be unable to find $500 in an emergency.

The Commonwealth Bank says it has introduced two new apps — Transaction Notifications and Spend Tracker — and is conducting ongoing experiments with additional functionality called Savings Challenge and Savings Jar that will be available to select customers in an experimental version of the CommBank Lab apps.

Pete Steel, executive general manager of digital, Commonwealth Bank, says the new features are aimed at improving a customer’s ability to meet their financial obligations every day, “to ensure they have savings in case of a rainy day, and to help meet saving, spending or investment goals in the future”.

“As Australia’s largest bank, we have a role to play in helping our customers achieve financial well-being. In a recent survey we found 73% of Australians want banks to do more to understand their needs and concerns and 72% want their bank to help them manage their finances in a rapidly changing world.”

Steel says one in three Australians consistently spent more than their income, in four consecutive months, during the last 12 months.

The bank currently has in trial, ready for launch this month for credit card customers, and later in the year for debit card customers, two new apps:

  • Transaction Notifications – real-time credit card transaction notifications that give customers immediate awareness and insights into their daily spend so they can better manage their finances and improve their savings.
  • Spend Tracker – a month-to-date summary of credit card activity that automatically categorises transactions and shows customers where their money is going so they can make better decisions on where to spend.

Other apps are still in trial in CommBank Labs including Savings Challenge – a comparison of a customer’s current transaction account spending against their average for the prior three months so they can track and improve their savings over time.

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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