Saving more popular than spending

Australians are taking a more cautious approach to finances than ever before, with many adopting new savings practices since the global financial crisis. Around a quarter of Australians say paying down debt is the best way to use excess cash, about double the long-term average, with a third nominating either this or other safe havens such as bank deposits, up from a more usual 25 per cent, according to the latest survey of consumer sentiment by Westpac and the Melbourne Institute.

Most areas of discretionary spending have been cut back. The consumer caution is not for the want of money. Westpac estimates average household incomes have been rising at a rate of 0.4 per cent a month, after allowing for the rise in mortgage costs.

Source: The Australian