Half of Australia can’t support themselves longer than 3 months if injured or ill

Key points:

  • 46% of Aussies have less than 3 months' emergency savings 
  • Women are 56% more likely to have 1 month or less in savings than men 
  • A high-interest emergency savings account, income protection or TPD insurance could help you out when you need it most. 
A young woman with a broken leg lays on the couch, staring pensively into her mobile phone

New research from life insurance provider MLC reveals that almost half (46%) of Australians have just three months’ savings or less to live on if they were injured or fell ill and couldn’t work. 

When asked how long they could cover their expenses if they suffered an injury or illness that prevented them from working, 29% said their current savings would only last one month, while a further 17% said they could hold out for one to three months.

A graph displaying the proportions of Australians with different amounts of savings buffers
Source: MLC Life Insurance via Freshwater Strategy

Women are much more likely to have savings of one month or less 

MLC found a gap between men's and women’s savings buffers, which puts women at 59% more likely to have savings of one month or less than men. 

On the other end of the financial spectrum, the percentage of men who reported a savings buffer of two years or more is 19%, but only 11% for women. 

So, what can be done for the 46% of Australians whose savings buffer would last them a quarter of a year at most? 

High-interest savings, income protection insurance & TPD insurance 

Building an emergency savings fund can be difficult during a cost of living crisis

So, when you do have spare cash to put away, make sure you find a high-interest savings account to generate some extra income. 

It might also be worth looking into whether you need income protection insurance, or not. 

Basically, it’s a way to cover a portion of your income if you’re injured or fall ill and can’t work. How much of your income is covered can differ from policy to policy, but it’s generally around 85% of your pre-tax income.

Remember, it’s very important to read the product disclosure statement (PDS) of the policies you compare to make sure you understand which circumstances are covered and which aren’t. 

You might also want to compare life insurance policies featuring a total and permanent disability (TPD) benefit, which can cover your rehabilitation and living costs if you’re unable to work due to a total and permanent disability. 

As part of the Mozo Experts Choice Awards^, the experts found Australia's best life insurance, highlighting a couple of exceptional value products. That’s a good place to start your search for an income protection or life insurance policy. Or, check out some of the featured providers below.

Life insurance comparisons on Mozo - rates updated daily

Search promoted life insurances below. Advertiser disclosure. Important information on terms, conditions and sub-limits.
  • Mozo Experts Choice 2024
    Life Insurance

    Life Insurance – Mozo Experts Choice Award Life Insurance Company of the Year for 6 years running*! Help protect your loved ones with award-winning Life Insurance from NobleOak. Get peace of mind with fully underwritten cover – don’t settle for anything less. General advice only, see website for T&Cs, PDS and TMD.

  • Mozo Experts Choice 2024
    Premium Life Direct Income Protection Insurance

    Income Protection – Mozo 2024 Exceptional Value Income Protection winner* Financial protection for you and your family if you suffer a sickness or injury and are unable to work. Premiums are generally tax-deductible, speak to your accountant to see if this applies to you. General advice only, see website for T&Cs, PDS and TMD.

* Terms, conditions, exclusions, limits and sub-limits may apply to any of the insurance products shown on the Mozo website. These terms, conditions, exclusions, limits and sub-limits could affect the level of benefits and cover available under any of the insurance products shown on the Mozo website. Please refer to the relevant Product Disclosure Statement and the Target Market Determination on the provider's website for further information before making any decisions about an insurance product.

^See information about the Mozo Experts Choice Life Insurance Awards