Australian consumers look for an escape

Australians are spending big on travel and online goods as a way to escape the doom and gloom of the economic downturn, a new survey shows.

WeMoney’s annual purchase intent survey found three quarters of Australians did not feel confident about the economy but about half were planning to spend more than $6000 on travel this year.

More than 50 per cent of people also spent more online in 2022 than they did the year before.

“The overall theme and mood is escaping reality for a brief moment,” WeMoney chief executive Dan Jovevski told AAP.

“They want to take their mind off all the doom and gloom that’s already out there.”

But saving is still a priority, with two in five Australians planning to put aside more money over the next six months.

About 75 per cent say they try to buy cheaper alternatives to their current brands, while two thirds have put off a major purchase.

With rising interest rates and inflation continuing in 2023, Finder money expert Sarah Megginson said there were ways to limit the damage to bank balances.

Having a high-interest savings account is one way to get “free money” as you put funds aside, Mrs Megginson said.

Finding cheaper insurers and service providers can also make a difference, as well as cutting out purchases like unused subscriptions.

“I always recommend getting a copy of your bank statement and looking at what you’re spending,” Mrs Megginson told AAP.

“It can be a little bit confronting the first time you do it but it can be incredibly illuminating.”

She said it was possible to make big purchases like a holiday as long as they were within your means.

“We’re seeing such an extraordinary rise in the amount of buy now, pay later that people are incurring,” she said.

“They can be a really easy way to get yourself into financial trouble.

“Europe’s not going anywhere. These travel experiences will be available next year if you can’t quite afford them this year.”

Analysis from UK financial services provider CMC Markets found more and more Australians are googling terms like “buy stocks” and “day trading”.

The share market was a great way to grow wealth but it was important to do research first, Mrs Megginson said.

“Make sure you’re not playing with money you can’t afford to lose,” she said.

“If you take very big risks, it’s a fantastic way to lose your money.”

https://thewest.com.au/business/finance/australian-consumers-look-for-an-escape-c-9378448