Aussies are worried about unexpected financial hurdles, but not doing anything about it, according to the findings of a survey of more than 1,000 Australians, commissioned by Comparethemarket.com.au.
The findings also show that one in four Australian adults fear redundancy, but one third of households do not save money for unexpected events.
Of those who save for a rainy day, 44% could only put aside up to A$200 (US$152) a month, while 27% saved between A$200 and A$500. Older generations were less likely to save each month, with 49% of over-55s not saving at all, compared to 27% of 18 to 24-year-olds and 32% of those aged 25 to 54.
Comparethemarket.com.au spokeswoman Abigail Koch said that while Australians knew they should be saving, many were disengaged with their future.
“Financial engagement is low, given the huge sums of money, the debt that households are in,” Ms Koch said. “Wages are flat and the willingness of banks to lend has left people with huge mortgages and rising costs of living. They are managing at the moment, in a low interest rate environment, but that could be a ticking time bomb.”
A large number remain disengaged or unaware about income protection insurance.
Just 55% of survey respondents knew it covered being out of work due to injury sustained outside the workplace -- rather than just being injured at work. Only 52% knew it covered critical illness sustained outside of work, while a worrying 35% believed redundancy cover was standard inclusion, when it is in fact quite uncommon and in many cases the benefits paid go to the loan or mortgage rather than the person.