A new survey from BankWest has discovered that furniture and holidays are the biggest culprits when it comes to luring us into the debt trap, but a relatively large number are still flexing the credit muscle just to pay for groceries and household bills.
The nationally representative survey of nearly 1,000 adults also investigated Australians attitudes to debt, revealing that our love/hate relationship with paying interest is still alive and well.
Says Dave Hunt, BankWest Head of Products and Marketing, "We asked Australians what items theyd bought which attracted interest on a credit card or personal loan. Furniture (21%) and holidays (19%) were the big ticket items, but its significant that more than a million 18 to 64 year olds have paid interest on household bills for groceries (8 per cent) and utility bills (7 per cent)."
"Even drinks at the pub made an appearance, with 6 per cent of men and 2 per cent of women - representing about half a million drinkers - saying theyve gone into debt to quench their thirst with a cold one."
"As part of BankWests Get Australia Saving campaign were trying to teach people simple yet effective ways to avoid the debt trap and form healthy financial habits that will set them in good stead for the future."
According to Gay Curtis, money coach and author of Smart Couples Guide to Money, "Debt can be a vicious cycle, especially if you dont have a good budget plan. Its important for people to be realistic about what they can and cant afford. It may sound simple, but if youre in a bind and need to save money, you need to start by spending less and saving more."
The BankWest survey also revealed a number of other key insights into peoples attitudes toward spending and debt, including: Around 3.6 million 18-64 year olds agree with the statement "money is easy to borrow these days, why not borrow it?"- men were significantly more likely to agree with the statement than women
More than 50 per cent of this age group claim its OK to buy non essential items on credit as long as they can meet the repayments. Those with higher amounts of current personal debt (such as unpaid credit card balances) are more likely to think that it is OK to go into debt for non essential items
The majority of those with personal debt (80 %) say they arent concerned with their debt. Among those that are concerned women are twice as likely to be concerned than men
BankWest has launched the Get Australia Saving Campaign an initiative designed to get Australians on the right track when it comes to saving. As part of the campaign, BankWest is supporting a new free website www.getsaving.com.au which is full of tips and tricks on how to get savings savvy and make the most of the time spent managing your finances.