Money Minute – August 17 2017 The Family Squeeze

Money Minute – August 17 2017 The Family Squeeze

Listen, its also the traditional day when people get paid, of course.

Except these days, it’s clear, your pay packet isn’t going as far as it used to.

The Bureau stats show the average of the pay packet rose just 1.9 percent in the last financial year – barely keeping up with inflation.

If you’re in the public service, it’s a little better – 2.4 percent.

But for the vast majority who work in private enterprise – 1.8 percent.

In other words, after inflation… you’re going backwards.

The problem, and it’s ongoing, is your personal family inflation rate is most likely higher than the official 1.9 percent.

Much Higher!

Think of rising costs of families can’t avoid, like health insurance.

The average price rose 4.8 percent this year. That’s after successive years of five percent increases.

Home and car insurance – there’s an average four percent rise this year… on top of a three percent rise last year.

Electricity – depending on where you live – it’s up between five and 20 percent.

Less in Queensland, where there’s a surplus of energy.

More in New South Wales and Victoria. The most in South Australia.

Kids education – costs have increased and the governments changed rules so uni students will see an extra $2,000 in the price of their courses by  2021.

Now a couple of days ago, economic research IBISWorld said a typical family will see their discretionary income cut $1,700 this year.

That’s because the price of essentials are rising so fast.

So what gives? The family holiday? Home repairs? Updating your wardrobe? Or buying  a new pair of shoes?

And every other part of the economy feels that.

One tone tell-tale of this …its household savings.

Families are now starting to dip into their savings to manage the higher prices they’re being forced to pay.

The other part of the equation is employment.

The latest numbers out today, and while the unemployment rate is flat, underemployment is high.

People can’t get enough hours to help pay those higher bills.

As I say…something has to give

Markets

The Dow Jones overnight up 25. 79.25 US Cents

Other related articles to budgeting and how to save money

08-08-2017 9News: Your shopping bill is in your hands

07-08-2017 9News: Petrol prices fall to 10 month lows…but not for all

26-07-2017 9News: Interest rate rises not coming anytime soon

19-07-2017 9News: Australian enjoy $140 million in Superannuation returns

06-07-2017 Credit Card reward points to be slashed by banks

01-07-2017 Money Minute – June 30 2017  35 Years of Finance

26-06-2017 Australia s most affordable suburbs

29-05-2017 Is Australia headed for a recession? ANZ Felicity Emmett

22-05-2017 Westpac reveals the impact of the bank levy

22-05-2017 Will your car let you know where the cheapest petrol deals are?

18-05-2017 9News: Bank Battle

18-05-2017 David Coleman – Recommendations to come into effect after bank inquiry

15-05-2017 60 Minutes: “When I was trying to buy my first home, I wasn’t buying smashed avocado for $19 and four coffees at $4 each”

10-05-2017 Economic growth optimistic – Alan Oster NAB

10-05-2017 John Key – Bank Levy, Budget and Housing Affordability

02-05-2017 ANZ CEO says budget key to getting young people into housing market

20-04-2017 9News: Government to start charging eBay GST for small imported goods

12-04-2017 Improving Payment Terms for Small Business

10-04-2017 Negative Gearing Reform – Saul Eslake

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