A new report form the Melbourne Institute and Commonwealth Bank revealed that the continued high level of financial wellbeing is partly due to the accumulated savings of Australians throughout the pandemic, which remain elevated when compared to pre-pandemic levels.
This is demonstrated through the median savings balance in December 2021 being 42% higher than the same time two years prior.
The report analyses aggregated transactional data of more than five million CBA customers each year to better understand the current financial wellbeing of Australians.
Scoring financial wellbeing from zero (low) to 100 (high), the average financial wellbeing score was calculated as 49.9 in December 2021.
This is down 0.8 points year-on-year, but is still 2.4 points higher than two years ago when the financial wellbeing score was 47.5.
Program Coordinator at the Melbourne Institute Professor John de New said these increased savings represent Australians hedging against uncertainties related to COVID-19, as well as rising inflation and returns on savings.
"Based on the underlying data there have been high levels of financial wellbeing during the pandemic, with the latest research showing Australians are continuing to fare well overall," Professor de New said.
Median 'inflows and income' also increased by $1,600 last year, but this was outpaced by the $3,600 increase in the median 'outflows and expenditure' throughout the same period.
"The data shows Australians started to spend more towards the second half of the year – likely due to pent up demand from earlier lockdowns," Professor de New said.
"While this contributed to the slight year-on-year decline in financial wellbeing, the increased spending speaks to the high consumer confidence reported at the end of last year."
CBA's Head of Financial Wellbeing Ben Graeu said the report helps CommBank 'deeply' understand its customers and what factors impact financial wellbeing over time.
"Despite the hardships of the pandemic, it is encouraging the research suggests the majority of Australians have better financial wellbeing than two years ago," Mr Graeu said.
"A range of macro and micro economic factors, such as Government support, and the ability to access financial support, such as deferring loans and small businesses accessing reduced lending rates, can all help to explain this."
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