Households take 'austerity measures' to cut spending

Australian households appear conservative in their spending habits despite the relative strength of the country's economy, a leading retailer has said.

Woolworths chief Michael Luscombe noted that there has been "a real shift towards value" among consumers aiming to keep a tight grip on household budgets.

However, speaking at the company's annual general meeting, Mr Luscombe also expressed his confidence in future growth as Woolworths confirmed a record net profit of $2.02 billion for the 2010 financial year, up 10.1 per cent on the previous year.

He suggested that conservatism among consumers was partly down to rising energy costs, healthcare costs, school fees and recent interest rate hikes. Aussies aiming to better manage their personal finances could choose to compare debit cards and other money products in search of the best deals.

"While austerity measures are thankfully not on our government's agenda, they do seem to be on the agenda of the average family's budget and we are witnessing a real shift towards value," commented Mr Luscombe.

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