ME: 34% of income-affected Aussies saving more than before COVID-19

Tom Watson

20 Apr 2020

Woman looking at ways to save covid 19 content

Over a third of Australians are putting more money into savings than they did before the Coronavirus pandemic, despite having had their incomes reduced. 

That’s according to research released as part of ME’s new COVID-19 Financial Sentiment Snapshot, which included a survey of 1,000 Australians completed last week.

34% of respondents to the survey whose incomes have been affected by Coronavirus reported to have increased the amount they were saving compared to before the pandemic, while the figure rose to 48% among those whose incomes have either been unaffected or increased. 

“Many households tend to put money aside as soon as they feel financially uncertain,” said ME Money Expert, Mathew Read. Having a financial buffer is a good idea as it provides peace of mind when it comes to paying bills, essentials, rent or a home loan.”

“One saving grace of staying at home is that we’re spending less on activities such as going out to dinner or taking holidays. For some, the lockdown is forcing us to save.”

While the majority of respondents to the COVID-19 Financial Sentiment Snapshot survey  reported that their incomes have either stayed the same (56%) or increased (11%) since the COVID-19 pandemic began, a considerable 33% have seen their income decrease. 

Even more Australians felt that they were likely to feel the effects of the outbreak in months to come, with 44% bracing for a future whack to their household incomes.

Compare savings accounts

Rates updated daily. Advertiser disclosure.

  • Promoted

    Virgin Money

    Virgin Money

    Boost Saver with Go Account

    1.50% p.a. (for $0 to $250,000)

    0.10% p.a.(for $0 and over)

    Yes up to $250,000

    *Intro bonus rate of 1.50% for first 3 months, reverting to 1.20% after. Bonus interest only applies when you deposit $2,000 into your Go Account and make 5 debit card purchases, direct debit or BPAY payments in the previous month. If you are between 18 and 25 you need to deposit $1,000 and fulfil the other criteria.

  • Promoted

    Rabobank

    Rabobank

    High Interest Savings Account

    1.35% p.a. (for $0 to $250,001)

    0.25% p.a.(for $0 to $250,001)

    Yes up to $250,000

    *Bonus rate for the first 4 months from account opening, reverting to standard variable rate. Rate shown is for Personal customers and is subject to change. Different rates apply to Business/SMSF customers.

  • Promoted

    Virgin Money

    Virgin Money

    Grow Saver

    0.65% p.a. (for $0 and over)

    0.10% p.a.(for $0 and over)

    Yes up to $250,000

    *Make at least 1 deposit and no more than 1 withdrawal, including internal transfers or external payments.

^See information about the Mozo Experts Choice Savings accounts Awards

How are financially-hit households saving money? 

As part of the survey, ME also asked respondents who have experienced a fall in income to share the steps they have taken to save money. 

By far and away the most popular method among respondents has been to cut out any unnecessary expenses (72%), followed by seeking some form of government assistance (29%) such as individual support payments or small business assistance.  

A quarter (24%) of affected households reported to drafting up a new personal budget, 19% said they had put more money aside to create an emergency fund and a further 19% had either switched or shopped around for new service providers (e.g. energy and internet) or financial products (e.g. savings accounts and home loans).

“If you have a little extra time on your hands at home, take advantage of it and review your finances and personal budget. It pays to focus on what you can control and taking stock of where your money is going now may really help your financial wellbeing in the future,” said Read. 

RELATED: How to take financial action during self-isolation and maximise your savings

Is it time to make the switch yourself to a more rewarding savings account? Check out some of the hot offers in the table further up the page, or look through an even greater range of offers with the latest rates over on the Mozo savings account comparison hub.