FINANCIAL STRESS INDICATORS


Financial stress indicators are an alternative method of considering whether households may be experiencing economic hardship. These indicators however, cannot identify whether their financial stress has been impacted by their spending choices. Table 1 lists experiences of financial stress and missing out which were last collected in the 2009-10 Household Expenditure Survey.

Table 1. EXPERIENCES OF FINANCIAL STRESS AND MISSING OUT IN THE LAST 12 MONTHS Financial stress experiences Missing out experiences Unable to raise $2000 in a week for something important Spend more money than received Could not pay gas, electricity or telephone bill on time Could not pay registration or insurance on time Pawned or sold something Went without meals Unable to heat home Sought assistance from welfare/community organisations Sought financial help from friends or family Could not afford holiday for at least one week a year Could not afford a night out once a fortnight Could not afford friends or family over for a meal once a month Could not afford special meal once a week Could only afford second hand clothes most of the time Could not afford leisure or hobby activities

Source: ABS Household Expenditure Survey (6530.0)

In 2009-10, younger households reported substantially more experiences of financial stress and missing out, than older households. The majority of older households reported none of the financial stress experiences (76%) or the missing out experiences (61%), listed in table 1. By comparison, about 70% of younger households reported at least one of each of these experiences in the previous 12 months.

Three or more financial stress experiences were reported by 29% of younger low income households and about 2% of older low income households. Younger households also more frequently reported three or more missing out experiences (44% compared to 16% of older households) (Graph 1).

There was a strong relationship found between financial stress and tenure type. Younger low income renters, both market renters and those in subsidised rental properties, most frequently reported three or more experiences of financial stress or missing out (68% and 84%, respectively). In comparison, around 40% of older low income renters reported three or more of these experiences (Graph 2).