Aussies falling short on financial aspirations as lack of confidence bites: Survey

Only a quarter of Australians feel well prepared to manage unexpected financial challenges, with 41% expressing ongoing concern about their current financial state, according to the results of MLC’s latest survey examining Aussies’ financial aspirations.

The second annual MLC Financial Freedom Report, which outlines the results of a survey of more than 2,500 Australians of diverse backgrounds, revealed Australians’ distinct lack of confidence in managing their finances.

Just over two out of five (41%) respondents believed they were only moderately equipped to manage their finances, with more than a quarter (28%) stating that they felt slightly or not at all provisioned to do so effectively.

This dearth of financial knowledge and wherewithal appears to be weighing heavily on many Australians, with a further 41% stating that they worry about their finances often or all the time.

However, many of those surveyed appreciated the importance of improving their financial knowledge to allay these concerns. Around one in three (30%) expressed that developing good financial habits would boost their confidence, while one in four (24%) said they would benefit from professional financial advice.

A clear majority of respondents – around 70% of those surveyed – made a direct connection between their financial well-being and their ability to achieve their life aspirations.

What is more, ‘financial independence’, overall, rated above regular holidays, good work/life balance, trusted family and friends, a happy marriage, and owning a home as a key life aspiration for Australians. However, these priorities were notably different for younger generations, with Gen Zs privileging work/life balance, career success, and home ownership over financial independence.

However, fewer than one in four (23%) said they were satisfied with their current financial position; just three in ten (31%) felt extremely or very equipped to make effective financial choices.

Australians, the survey results showed, clearly recognise the impact financial wellbeing can have on their health and mental wellbeing (70%), and on personal (67%) and family (62%) happiness.

MLC noted a considerable gap between aspiration and actions – or simply capacity – to achieve financial well-being.

Indeed, just one in three (34%) said they were actively taking steps to make their dreams a reality.

Cost of living was seen as the primary barrier to Australians achieving their financial aspirations, rated by 62% overall, with Generation X feeling the pressure most acutely (74%). This barrier was least felt by Baby Boomers, with 57% expressing concerns over cost of living inhibiting their aspirations.

Other external barriers identified in 2024 include current income (34%), interest rates (25%), not owning a home (17%) and a lack of job security (13%).

Boosting financial confidence

One in three (30%) respondents said developing good financial habits would give them greater confidence in navigating financial challenges.

More Australians today recognise the importance of advice in attaining their goals. A quarter of respondents (24%) say they would benefit from having access to financial advisers or professionals, up from one in five (20%) in 2023.

However, family support also plays an increasingly important role in supporting younger Australians to secure their financial footing.

More than two in five Australians (43%) who have received substantial support from their families are extremely or very satisfied with their current financial situation, compared with fewer than two in ten (17%) who did not receive financial help.

The most common form of support that Australians with children provide or plan to provide is allowing adult children to live at home for free or for board (40%). Other common forms of support include paying school and university fees (38%), helping adult children to buy their first car (37%), and paying for educational supplies or technology support (30%), the report revealed.

Grandparents are also playing an increasingly prominent role in supporting younger Australians.

Among the younger generations, six in ten (60% Generation Z; 56% Generation Y) received financial support from their grandparents upon reaching adulthood. This compared with just two in ten (20%) Generation X and less than one in ten (6%) Baby Boomers.

Jenneke Mills, MLC’s head of technical services, said the survey results reveal that many Australians lack the confidence to achieve financial well-being – that is to “meet their financial needs, live free from financial stress or worries and have the financial freedom to make independent choices”.

“The research highlights that in today’s world, developing good financial habits, underpinned by family support, is key to building confidence and achieving those dreams.”