Mozo: 75% of Aussies don’t have savings to cope with a crisis

The fallout from coronavirus has placed many Aussies under financial strain, with new Mozo research revealing 3 in 4 households are ill-prepared to handle unexpected expenses. 

According to Mozo's recent survey with 1,233 Australians, only 25% have the savings to stay afloat when faced with unforeseen circumstances.*

Meanwhile, 1 in 5 respondents admitted they turned to lines of credit to support themselves through difficult times. 

This isn’t surprising, given that half of all working households surveyed had less than $7,000 in their bank, while 1 in 10 had as little as under $90. 

“Unforeseen expenses are never a welcome surprise, and for many Australian families, the spread of Covid19 is the most disruptive financial event that they’ve ever experienced - with hundreds of thousands likely to be out of work in the next few months,” Mozo’s Director, Kirsty Lamont said.

“Households that are lucky enough to have $7K in savings would only be able to last 4.4 weeks if they lost their income.” 

The average Australian is hit with a whopping $1,900 in surprise costs each year. Yet separate Mozo research found half of the nation is stashing away less than $200 a month, with 40% unable to put any part of their paycheck towards savings.**

“The image of hundreds of people queued outside welfare offices across the country is a reflection of just how hard many Australians are doing it,” Lamont said. 

How long can my savings cover expenses?

No savings account balance is the same, so Mozo crunched the numbers to reveal how many weeks of expenses your cash stash may cover you for:

Amount in savingsLength of time able to cover weekly household expenses
$1,5941 week
$3,1882 weeks
$4,7823 weeks
$6,3764 weeks
$7,9705 weeks
$9,5646 weeks

How to plan for unexpected expenses

Lamont said when it comes to creating a financial lifeline for yourself, the key is to have a solid emergency savings fund.  

“Covid19 has proven that it’s impossible to predict what’s around the corner, so having a financial safety net is crucial to help you weather unforeseen events and unexpected financial hits,” she said. 

“Being stuck at home means our spending options are limited, so use this as an opportunity as a time to build a buffer. Aim to save at least 20% of your take home pay over the next few months.”

Here are a few tips to spruce up your savings while in self-isolation: 

  • Be creative with how you earn money: Make the most of your time holed up at home by exploring ways to monetise your skills. For instance, you could bring in a few extra dollars with a new side hustle, whether that’s doing online surveys or picking up freelance work.
  • Trim the fat off your expenses: From cancelling that gym membership to pulling the reins in on online shopping, there are many ways you can reduce your expenses and redirect them towards a savings goal. Give your budget a health check up to see which areas you can cut down on.
  • Let apps do the heavy lifting: Download apps like Pocketbook, Spendee and MoneyTree which can track and categorise your spending. That way, you can identify any unnecessary purchases and turn them into savings instead!
  • Take advantage of set-and-forget features: Some banks like ING, Bank Australia and Up offer a nifty round-up feature that automatically rounds up any purchases made on your debit card to the nearest $1 and $5, before transferring the difference into your savings account. Talk about an effortless way to save! You can also set up direct debit to transfer your monthly pay straight from your everyday transaction account to your high interest savings account

For more information, check out our essential guide to build an emergency savings fund

Or if you’re ready to stash away cash for unforeseen circumstances like the coronavirus, hop on over to our high interest savings account comparison table or check out some options below.

Savings accounts 2020 - last updated 6 August 2022

Search promoted savings accounts below or do a full Mozo database search . Advertiser disclosure
  • Save Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    2.35% p.a. (for $0 to $250,000)
    0.10% p.a.(for $0 and over)
    Yes up to $250,000

    Deposit at least $200 to either Spend or Save account from an external source each month.

    Earn up to 1.85% p.a in interest. No monthly fee to pay. Split your money in up to 10 Save accounts. Track your progress on each of your save accounts. Instant access to cash via PayID and Osko. Deposits guaranteed up to $250k per customer.

    Details
  • Mozo Expert Choice Badge
    Boost Saver with Go Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    2.30% p.a. (for $0 to $250,000)
    0.05% p.a.(for $0 and over)
    Yes up to $250,000

    Bonus rate of 2.30% is made up of the Base rate of 0.05% and Bonus rate of 2.25%. Deposit $2,000 each month and make 5 eligible payments from your Go Account. If you are between 18 and 25 deposit $1,000.

    Enjoy a high interest savings account bundled with an everyday spending account. No monthly fees. And new customers can get a welcome bonus of 5,000 bonus Virgin Money Points (ends 31/08/22. Offer criteria & T&Cs apply).

    Details
  • Mozo Expert Choice Badge
    Life - 18-29 years old
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    2.75% p.a. (for $0 to $30,000)
    0.65% p.a.(for $0 and over)
    Yes up to $250,000

    Make 5 card purchases/month with a Westpac Choice account and min 1 deposit and higher balance than at the beginning of the month in Life savings account.

    Are you 18 - 29 years of age? Earn up to a generous 2.75% p.a. variable interest on your savings when you spend and save with Westpac. For individuals aged 18 to 29 on Westpac Life account balances up to $30k.

    Details
  • Mozo Expert Choice Badge
    Bonus Saver Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    2.10% p.a. (for $0 to $250,000)
    0.05% p.a.(for $0 and over)
    Yes up to $250,000

    Bonus rate when at least $20 is deposited each month and five Visa Debit transactions are made each month using linked Glide transaction account.

    Winner of a Mozo Experts Choice Award 2022 in the Regular Saver category. No monthly account fees. Available only on balances up to $250,000.

    Details
  • Mozo Expert Choice Badge
    High Interest Savings Account
    Maximum rate
    standard interest rate
    Govt Deposit Guarantee
    2.60% p.a. (for $0 to $250,001)
    1.50% p.a.(for $0 to $250,001)
    Yes up to $250,000

    Bonus rate for the first 4 months from account opening

    Kick start your savings with the 4 month introductory variable rate. No fees, no minimum balance, no minimum monthly deposit and no minimum term.

    Details


* Notes on research -  Survey findings are from a nationally representative survey of 1,233 Australians conducted from 21 January to 3 February, 2020. Australians were asked how they fared financially in the face of unforeseen financial challenges.
** Survey findings are from a nationally representative survey of 1,036 Australians conducted from 1-3 October, 2019. Australians were asked how much they saved per month as well as the top three items they’d skimp on if they were not going to make it to payday.

^See information about the Mozo Experts Choice Savings Account Awards

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