Something old, something new: Millennials choose a mortgage over wedding bells
Research conducted by ME bank has shown that more and more young Australians are faced with a choice between tying the knot and buying a home - and that the latter is coming out on top.
The average cost of a wedding in Australia is estimated by ASIC to be around $36,000, so it’s no wonder that nearly 23% of millennials have opted to downsize or delay their big day. Instead, they’re putting that money towards buying a home, ME found in a survey of 2,036 Aussies.
Patrick Nolan, head of home loans at ME bank, said that young couples rethinking the value of an extravagant wedding is unsurprising considering the state of the housing market, with prices more than doubling in the past 15 years.
This changing market is also reflected in the difference between the number of baby boomers (4%) and Gen X’ers (8%) who saw fit to make the same sacrifice when it came to nuptials.
But the wedding day is not the only event that is seeing the effects of budgeting. 21% of millennials also downsized or delayed their honeymoon, while 24% will delay or have fewer children in favour of paying off a home loan. Just 9% of baby boomers or Gen X’ers compromised on their dream honeymoon, while 10% of baby boomers and 12% of Gen X’ers delayed or had less children in favour of buying their first home.
Buying a home has become such a daunting cost that asking for a cash gift toward a house deposit in lieu of traditional wedding gifts has become a trend amongst young Aussie couples.
Nolan had some advice for young Aussie couples, saying, “What we’ve seen, however, is that with a little lateral thinking and some sensible saving and budgeting, couples are finding increasingly savvy ways to save for their house deposit and eat their wedding cake too.”
Here are ME bank’s tips to carry you over the financial threshold:
- Something old: and so the old adage goes: a little goes a long way. Set a fixed amount to be automatically deposited into a high interest savings account so you’re less inclined to touch it. It won’t be long before you start to see that pot of savings grow.
- Something new: deploy a new home buying strategy: buy with friends or family, consider alternative locations, or start out with an investment property to get your foot in the door.
- Something borrowed: in the current climate, we’re seeing more than ever, families getting together to help out with big financial decisions such as buying a home and saving for a deposit.
- Something blue: avoid a ‘financial blue’ by talking about your finances. According to a ME survey, the more you talk about money, the less tension and conflict it causes.