LifestylePersonal Finance

Are You Prepared for a Further Hike in the Cost of Living?

The people of Australia are undergoing a Sisyphean task. Every day, they try to push the boulder they bear to the top of the hill. Every day, it rolls back down to the bottom. The weary citizens’ burden only increasing with each exertion as the hill gets bigger and bigger. And all under the duress of limited time, energy, and effort to give.

It’s a tragedy worthy of the ancient playwrights, except Australians have to go through it in reality. Their boulder, their burden, are set salaries. Their perpetually growing mountain is the rising cost of living in the nation.

It has become common knowledge around the globe that Aussies are dealing with a domestic financial crisis. As people try to work and earn their fair share, the prices for all goods (necessary or otherwise) is increasing. One in ten families are fighting to remain above the poverty line. The number of citizens between the ages of 18-24 are especially hard hit by this most pertinent of issues. As they have been noted to have a difficult time saving money in the best of times, this period of global recession and domestic inflation has been especially hard on them.

What’s incredible aren’t just the personal stories. What truly shows how rough it’s become is how the prices of everything compares to other places. That, and how it’s still growing unabated. Andrew Boyd, who helped research and develop CreditCardCompare’s Cost of Living Heatmap said: “Everybody knows that it has been getting more expensive to live in Australia, but it is still surprising to actually see how much the cost of everyday items has risen. Even taking the most cursory of looks at our heatmap and you can see how much more expensive it is simply to get by compared to a decade ago. And the problem isn’t just with certain categories of goods and services. As the heat map shows, it’s across the board. It’s more expensive to do just about anything.”

When compared to the cost of living in one of the West’s most expensive cities, New York, Australia paints a dismal picture. The consumer price index is 33% higher than in New York. Groceries are 27% more costly. Even entertainment like dining out at a restaurant is significantly pricier by comparison.

Politicians are beginning to take note of the impact this is having on the average person. But as is the case with so many political topics, it’s impossible to determine whether or not it’s merely an effort to placate constituents. All that can really be determined is that they are responding to their cries. Promises are being made in preparation for the upcoming elections and there does seem to be cross-party recognition that this is an issue that needs to be addressed. The question on so many lips is how?

For many, one of the most simple ways to ease the pain is basic austerity. Deciding where and when certain purchases are necessary is the easiest way to help save money. There are few people who won’t have made some sort of cuts to their personal spending in the last year or two, and who can blame them? The RBA has cut interest rates, but the banks seem oblivious to a downward trend years in the making.

Austerity isn’t the only way to combat the issue. Finding competitors who offer the product at a lower price will also ease the burden. It works on a two-fold level. On the one hand, it immediately benefits the spender. On the other, if enough people do it, it will drive down the prices of goods.

The truth for many, though, is that making cuts just isn’t going to make a big enough difference in their finances. A loaf of bread may not cost millions of dollars like it would in Zimbabwe, but the cost of living in Australia is an issue that is not going to go away easily, and must be dealt with both on an individual and national level.


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