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Majority of Aussies think they are financially ‘worse off’ as optimism craters
Australians are increasingly pessimistic about their finances, with more than half of households reporting they are "worse off" now than they were a year ago.
- Australian households feel they are “worse off” now than they were a year ago, as inflation continues to outpace wages.
- Four interest rate rises in 2026 have placed more households at risk of mortgage stress.
- Households are combating price rises not just on their mortgage repayments, but all other bills as inflation persists.
Australians are increasingly pessimistic about their finances, with more than half of households reporting they are “worse off” now than they were a year ago.
The ANZ-Roy Morgan Consumer Confidence survey, which tracks the economic mood of Australian residents, found that in late October approximately 52 per cent of Australians who say their personal finances are suffering.
Just one in six, or 16 per cent, of respondents said they were better off financially now than last year.
ANZ economist Sophia Angala said this week’s reading was one of the lowest on record.
“The ANZ-Roy Morgan Australian Consumer Confidence was broadly unchanged last week but remained historically low, recording its twelfth-lowest result since the series began in 1973,” she said.
“Confidence in economic conditions declined, which may reflect the easing in labour market conditions shown in last week’s labour force data, with the unemployment rate rising in September to its highest level since 2021.
“Overall, persistently weak confidence suggests household spending growth is likely to remain subdued over the near term.”
Flat confidence comes as number of households ‘at risk’ of mortgage stress soars
As consumer confidence dips, so too does the number of households comfortably meeting their mortgage repayments.
Roy Morgan’s mortgage stress tracker, also released today, showed 31.8 per cent of mortgage holders were now “at risk” of mortgage stress, up a staggering 7.8 per cent since January.
The tracker, which interviews more than 10,000 owner-occupiers each year, found that many were feeling the impact of four interest rate increases from the RBA this year.
Michele Levine, CEO of Roy Morgan, said households are feeling financial pain from all angles.
“Mortgage stress is just one indicator of the pressure Australians are under,” she said.
“So far this year the RBA has increased interest rates four times which has significantly increased mortgage repayments, and along with other factors such as declining house prices in key markets, and a contracting Australian workforce compared to earlier this year, has steadily increased the pressure on average Australians.”
Roy Morgan considers a household to be “at risk” of mortgage stress when it is paying more than a certain proportion of its after-tax household income, typically around 45 per cent.
Levine said the current figures are nearing those felt during the Global Financial Crisis.
The latest figures for mortgage stress are just below the record highs reached during 2008, when official Australian interest rates hit a 30-year high of 7.25 per cent in mid-2008,” she said.
“This led to record high levels of mortgage stress during this period, peaking at 35.6 per cent in the three months to May 2008.”
Topics: Inflation, money, Mortgage stress