80% of Aussies fear economic impacts of coronavirus, finds Mozo research

New research from Mozo has revealed that 80% of Australians are worried about the economic impacts of the Coronavirus and that 1 in 5 have no savings and cannot afford to stop working.

The spread of the Coronavirus (COVID-19) has been making big news around the world since early January, but it wasn’t until the last few weeks that the effects of the global pandemic really hit home in Australia.

Now a Mozo survey has shown that 47% of workers in Australia would be unable to work remotely, should their place of business shut down, with a further 30% not eligible for paid sick leave. That’s a huge 7.6 million workers who could be left high and dry with no income for the foreseeable future.

Mozo Director, Kirsty Lamont said, “Mozo research has found that Coronavirus is driving a lot of economic worry right now, more so than rate cuts, the bushfires, a depressed retail sector and dropping unemployment. There are portions of Australians who are very vulnerable financially - those who have casual contracts, are unable to work remotely, aren’t eligible for sick leave, have dependents, or don’t have a savings fund.”

In fact, the survey showed that for more than 50% of Aussies, Coronavirus is viewed as the biggest threat to the economy, above all other concerns. The research also revealed that more women than men cannot work remotely and therefore could be more affected by a nationwide shutdown of businesses.

5 ways to protect your finances during COVID-19 shutdown

If ever there was a time to use a rainy day fund or think about starting one, it’s now. Here are five top tips from Mozo to protect your finances:

1. Think about refinancing your home loan

If you have a home loan and you’ve never refinanced or you haven’t for a while, then you might want to think about comparing refinance home loans to find a more competitive interest rate than the one you have right now.

Lamont commented, “Mozo research found that only one in four property owners have refinanced, so now is the perfect time to make the move with savings of up to $100k possible by opting for a competitive online lender compared to the big four banks. From the moment you pick up the phone to signing on the dotted line the average amount of time it takes to refinance is five days, meaning that you could pocket $21k a day in savings.”

Plus with the Reserve Bank of Australia looking to make an emergency cut to the cash rate, further home loan rate cuts could be on the horizon. 

2. Get a high interest savings account

Contrary to popular belief, accumulating interest isn’t just for billionaire investors. With a more competitive savings rate you could earn yourself a tidy sum of interest to stash away for a rainy day. An extra $10 or $20 may not seem like much right now, but it could make all the difference if you find yourself stuck at home, running low on groceries.

2.00% p.a. is the highest ongoing savings rate available in the Mozo database right now, in comparison to a much lower 0.90% p.a. market average*.

3. Pay yourself first

You may have heard this one before, but sometimes the oldest tricks in the book are the most helpful. Set up a direct debit to transfer money from your everyday transaction account to your savings account on payday. 

Just make sure that however much you transfer is realistic, you don’t want to have to dip into your savings later on because you find yourself short on cash. It might even be a good idea to create a budget for yourself, then you can figure out how much you have left over to shift into your savings after you’ve made any regular rent, mortgage, energy bills or grocery payments.

4. Keep track of your spending

Speaking of budgets, try to keep track of what you’re spending. With more and more banking apps offering ways to track your spending these days, keeping on top of what you’re using your money for is easier than it has ever been.

You could even download one of these seven budget and savings apps, to give you more of an idea of what unnecessary items you might be spending money on and where you could be cutting back.

5. Set yourself a goal

Set yourself a tangible goal and a timeframe to reach it in. For instance, you might want to save $5,000 over 6 months. Having a set amount to save over a set period of time will give you an idea of how much you need to put away either each week, fortnight or month. 

Plus reaching the halfway or even quarter way point might spur you on to the finish line! You might even wind up saving more. Of course before you get ahead of yourself, start by setting up a savings plan.

Other resources to help deal with the financial impacts of Coronavirus:

• Guide to Australian banks’ emergency Coronavirus relief packages
• What the coronavirus stimulus package will mean for Aussie small businesses
• Are you covered for Coronavirus under your credit card travel insurance?
• Keeping up with the Coronavirus

Feeling inspired to rethink your savings account? Why not check out Mozo’s savings account comparison page to have a look at what is on offer in Australia right now, or scroll down to see what high interest savings account you could be stashing your cash in.