Debt dilemma Down Under: Aussies refuse help amid mounting financial pressures
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As financial pressures mount, a significant number of Australians are finding themselves grappling with debt.
Despite the growing burden, many are hesitant to seek assistance, potentially worsening their financial struggles.
This reluctance to ask for help highlights a concerning trend that needs urgent attention to ensure individuals can manage their debts effectively and regain financial stability.
According to recent research from ASIC's Moneysmart, a staggering 47 per cent of Australians with debt—an estimated 5.8 million people—have struggled to make repayments in the last year.
While the reasons for this financial strain varied, reduced income, unexpected expenses, and the relentless pressure of rising costs were the chief culprits.
The data painted a concerning picture, particularly for certain demographics.
Millennials and parents with young children are bearing the brunt of these tough times.
Over half of the millennials surveyed (54 per cent) anticipate financial hardship in the coming year—a figure that stands in stark contrast to 39 per cent of Generation X and 31 per cent of baby boomers.
Parents with children under 18 are also feeling the pinch, with 56 per cent reporting significant financial stress.
Despite the widespread struggle, a mere one in five of those in debt have sought financial assistance.
This reluctance is compounded by a lack of awareness, with 55 per cent of respondents unaware that they could even ask for help from their bank or lender.
Furthermore, 30 per cent of those surveyed would not seek help on principle, fearing additional costs or doubting the efficacy of their lender's assistance.
The research highlighted the lengths to which Australians will go to stay afloat financially.
Selling personal belongings is a route 42 per cent would take, while 40 per cent would consider taking on a second job.
These are not easy decisions to make and often come with their own set of emotional and practical challenges.
The barriers to seeking help are not just practical; they're emotional, too.
A significant number of respondents (37 per cent) didn't know about the assistance available to them, a third (33 per cent) were unsure where to start, and 31 per cent were wary of who to trust.
On an emotional level, stress and anxiety (51 per cent), shame and embarrassment (40 per cent), and feelings of failure (40 per cent) are powerful deterrents.
In response to these findings, Moneysmart is launching a new campaign titled ‘Just Ask! Hardship Help is available’.
ASIC Commissioner Alan Kirkland expressed his worry, saying, ‘It is concerning that people would rather sell their personal belongings or get a second job rather than seek financial hardship assistance.’
‘Customers in hardship are entitled under the law to request assistance. These findings should be top of mind for lenders when supporting Australians in financial hardship.’
Mr Kirkland stated that lenders, such as banks, are obligated to provide financial assistance to individuals facing debt challenges.
‘If you aren't happy with your bank or lender's response, make a complaint and, if that doesn't resolve the issue, contact the Australian Financial Complaints Authority,’ he suggested.
The reluctance to seek help for debt-related issues isn't isolated to a single demographic; financial stress is a widespread issue affecting various age groups across Australia.
Recent studies highlighted the severity of this problem, revealing which generations are most burdened by financial pressures.
This growing concern underscores the need for targeted support and resources to help Australians manage their finances effectively.
Have you recently faced financial hardship? What steps did you take to manage your situation? We invite you to share your experiences and thoughts in the comments below.
Despite the growing burden, many are hesitant to seek assistance, potentially worsening their financial struggles.
This reluctance to ask for help highlights a concerning trend that needs urgent attention to ensure individuals can manage their debts effectively and regain financial stability.
According to recent research from ASIC's Moneysmart, a staggering 47 per cent of Australians with debt—an estimated 5.8 million people—have struggled to make repayments in the last year.
While the reasons for this financial strain varied, reduced income, unexpected expenses, and the relentless pressure of rising costs were the chief culprits.
ASIC's Moneysmart research showed that almost half of Australians in debt faced repayment difficulties within the past year. Credit: Shutterstock
The data painted a concerning picture, particularly for certain demographics.
Millennials and parents with young children are bearing the brunt of these tough times.
Over half of the millennials surveyed (54 per cent) anticipate financial hardship in the coming year—a figure that stands in stark contrast to 39 per cent of Generation X and 31 per cent of baby boomers.
Parents with children under 18 are also feeling the pinch, with 56 per cent reporting significant financial stress.
Despite the widespread struggle, a mere one in five of those in debt have sought financial assistance.
This reluctance is compounded by a lack of awareness, with 55 per cent of respondents unaware that they could even ask for help from their bank or lender.
Furthermore, 30 per cent of those surveyed would not seek help on principle, fearing additional costs or doubting the efficacy of their lender's assistance.
The research highlighted the lengths to which Australians will go to stay afloat financially.
Selling personal belongings is a route 42 per cent would take, while 40 per cent would consider taking on a second job.
These are not easy decisions to make and often come with their own set of emotional and practical challenges.
The barriers to seeking help are not just practical; they're emotional, too.
A significant number of respondents (37 per cent) didn't know about the assistance available to them, a third (33 per cent) were unsure where to start, and 31 per cent were wary of who to trust.
On an emotional level, stress and anxiety (51 per cent), shame and embarrassment (40 per cent), and feelings of failure (40 per cent) are powerful deterrents.
In response to these findings, Moneysmart is launching a new campaign titled ‘Just Ask! Hardship Help is available’.
ASIC Commissioner Alan Kirkland expressed his worry, saying, ‘It is concerning that people would rather sell their personal belongings or get a second job rather than seek financial hardship assistance.’
‘Customers in hardship are entitled under the law to request assistance. These findings should be top of mind for lenders when supporting Australians in financial hardship.’
Mr Kirkland stated that lenders, such as banks, are obligated to provide financial assistance to individuals facing debt challenges.
‘If you aren't happy with your bank or lender's response, make a complaint and, if that doesn't resolve the issue, contact the Australian Financial Complaints Authority,’ he suggested.
The reluctance to seek help for debt-related issues isn't isolated to a single demographic; financial stress is a widespread issue affecting various age groups across Australia.
Recent studies highlighted the severity of this problem, revealing which generations are most burdened by financial pressures.
This growing concern underscores the need for targeted support and resources to help Australians manage their finances effectively.
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