Results and insights from the Citi Fin

Transcription

Financial education.
Shaping your future.
Results and insights from the Citi Fin-Q Survey
March 2008
Contents
Introduction
3
Services and products – who has what?
5
Quality of life – how satisfied?
6
Optimism towards financial future
7
Budgeting – what’s that?
8
Current approach to savings
10
Paying off the credit card
11
Current home ownership status
13
An underinsurance epidemic
14
How much is enough to retire on?
16
An investment hypothetical
18
Formal retirement plan – who has one?
20
Up-to-date will anyone?
21
Overall level of financial understanding
22
Comfortable in retirement?
25
Can I have some money kids?
26
Rainy day savings
27
Agree or disagree?
28
Statement: Given the recent market volatility and swings, I’m staying out of the share market
28
Statement: Market movements have not changed my investment behaviour
29
Statement: You have to accept short-term swings or volatility in the share market
30
Statement: If I was given $1,000 I would spend it not save it
31
Statement: When it comes to money management and personal finance matters,
my parents taught me to be financially responsible
32
Statement: I feel quite confident about my country’s economic future
34
Statement: I don’t feel very secure in my current job
35
Sources of information on money matters?
36
Fin-Q scores
38
Conclusion
39
Take the Citi Fin-Q score challenge
40
FIN-Q Survey 1
2 FIN-Q Survey
Introduction
Most of us know that IQ stands for Intelligence Quotient and is used as a
measure of intelligence. The Citi Fin-Q Survey was designed to measure
the Financial Quotient (Fin-Q Score) or financial well-being of consumers.
As part of this survey, Citi scored respondents on 11 different questions
closely related to financial well-being with a maximum possible Fin-Q score
of 100. The results ranged from terrible to pretty good – and once you’ve
read our report, you’ll have a better understanding as to why.
The Citi Fin-Q Survey involved surveying 4,400 people across 11 countries.
The results we share with you today are taken from a representative sample
of 400 Australian adults, aged 18 or older who were surveyed between
October 8-12, 2007.
A comparative look at all the countries involved in the study will be released
next. This should reveal some really interesting cultural and market insights
as Australia goes head to head with countries like India, China, Indonesia,
Taiwan and Thailand. Who’s Fin-Q score will come out on top?
We hope the findings are food for thought – they cover the whole gamut
of personal finances as well as aspirational notions like how satisfied
Australians are with life overall and their optimism for their financial future
– and the economic future of our country.
FIN-Q Survey 3
18-29
100%
30-39
100%
99%
40+
0
10
20
30
40
50
60
70
80
Total
69%
Male
70%
90
100
68%
Female
60%
18-29
65%
30-39
78%
40+
0
10
20
30
40
50
60
70
80
90
100
60
70
80
90
100
60
70
80
90
100
42%
Total
43%
Male
41%
Female
35%
18-29
43%
30-39
45%
40+
0
10
20
30
40
50
38%
Total
34%
Male
43%
Female
26%
18-29
45%
30-39
40%
40+
0
10
20
30
40
50
Personal loan / line of credit
30%
Total
23%
Male
38%
Female
35%
18-29
37%
30-39
21%
40+
0
4 FIN-Q Survey
10
20
30
40
50
60
70
80
90
100
“Thirty eight
percent of women
said they have a
personal loan or line
of credit compared
with 23% of men”
42%
Total
Services and products
– who has what?
Male
Total
Total
Female
Male
Male
18-29
Female
Female
30-39
18-29
18-29
40+
30-39
30-39
40+
40+
To set the scene we asked people what financial services and
products they held. Unsurprisingly, 100% of people surveyed said
they have a bank account. Around seven in ten (69%) also have a
credit card in their own name, 42% have private health insurance
and 38% have a mortgage. Only 24% of Australians have an up-todate will and 12%, a dedicated retirement savings account.
In comparing the sexes, 43% of women said they have a home
loan compared with 34% of men. Thirty eight percent of women
said they have a personal loan or line of credit compared with
23% of men. Men are more likely to have investments like shares
or bonds, 27% compared to 15% of women.
Age breakdowns also revealed some differences. The 40+
category are much more likely to have a credit card than those
in the 18–29 year old category – 78% versus 60%. Younger age
groups are more likely to have personal loans/line of credit and
the over 40s are more likely to have life insurance, a current will
and investments.
100%
Total
100%
Total
Our
findings also reveal a positive correlation between
having
100%
certain
Those
Male financial products and optimism for the future.
who are very optimistic about their future are much more likely
100%
Female
to have things like an up-to-date will, life insurance, private health
100%
18-29
insurance
and investments compared to those who
are worried
about
their
financial
future.
100%
30-39
99%
40+
Comparisons
0
10 20 30
40
50
60
70
80
90
100
Major credit card in your name
Total
69%
Male
70%
68%
Female
60%
18-29
0
10
0
0
10
10
35%
38%
38%
43%
35%
35%
45%
37%
37%
20 30 40 50 60
21%
21%
20
20 30
30 40
40 50
50 60
60
0
90
100
70
70
80
80
90
90
100
100
60
60
70
70
80
80
90
90
100
100
46%
46%
50 60
60
50
70
70
80
80
90
90
100
100
28%
28% 38%
Male
Male
34%
32%
32%
43%
24%
24%
Female
Female
15%
15% 26%
18-29
18-29
30-39
30-39
29%
29%
0
0
10
10
45%
40%
35%
35%
30
30 40
40 50
50
40+
40+
20
20
An up-to-date will
27%
27%
30%
Total
Total
26%
26%
23%
Male
Male
29%
29% 38%
Female
Female
7%
7%
18-29
18-29
35%
30-39
30-39
22%
22%
40+
40+
21%
20
30
20 30
0
0
10
10
37%
40
40
Investments (stocks, bonds, certificates of deposits)
Total
Total
Total
Male
Male
Male
Female
Female
Female
18-29
18-29
18-29
30-39
30-39
30-39
40+
40+
40+ 0
0
0
10
20
30
40
50
60
70
80
90
100
28%
21%
21%
32%
27%
27%
24%
15%
15%
15%
13%
13%
29%
17%
17%
35%
30%
30%
10 20 30 40 50
10 20
20 30
30 40
40 50
50
10
60
60
60
70
70
70
80
80
80
90
90
90
100
100
100
42%
Total
43%
Male
11%
11%
18-29
Female
Female
7%13%
13%
22%
9%
9%
40+ 0
40+
0
0
43%
30-39
29%
Female
Male
Male
40+
30-39
30-39
35%
18-29
26%
12%
12%
30-39
18-29
18-29
41%
Female
27%
Total
Male
Total
Total
Private health insurance
9%
9%
10 16%
20 30
16%
10 20
20 30
30
10
46%
40
50
60
70
80
90
100
40
40
50
50
60
60
70
70
80
80
90
90
100
100
50
60
70
80
90
45%
40+
0
10
20
30
40
50
60
70
80
90
100
21%
Total
27%
Male
15%
Female
38%
Total
34%
43%
Female
18-29
80
78%
40+
Male
70
Total
Total
65%
30-39
41%
23%
23%
Mortgage / home loan
100%
30-39
43%
30%
30%
26%
13%
18-29
17%
30-39
30%
40+
0
10
20
30
40
FIN-Q Survey 5
100
Quality of life – how
satisfied?
Low <$30K 12%
The perception of Australians’ quality of life varies in this research
but overall, Australians appear to be very satisfied with their lot
in life. The total response for this question shows that 19% of
Australians are very satisfied with their current quality of life,
58% are satisfied and 23% are not satisfied.
A deeper look at the data however reveals that those with high
personal incomes (greater than $50,000), regular savings
patterns, a good understanding of personal finance and pay their
credit card balance off in full each month are much more likely to
be very satisfied with their quality of life.
For example, when it comes to paying off the monthly credit card
bill, the findings revealed that those who are less diligent are
also less satisfied with their quality of life. Twenty seven percent
of people who don’t pay off their full balance said they are not
satisfied with their current quality of life compared to 17% of
people who do pay off their full monthly balance.
Similarly, 40% of those who rarely save are not satisfied compared
with only 11% of those who do save money from each pay.
Comparisons
Med $30-$50K 16%
Low <$30K 12%
55%
33%
61%
55%
23%
33%
Annual personal income
Low >$50K
<$30K 12%
24%
High
Med $30-$50K 16%
Low <$30K 0 12%
20
Med $30-$50K 16%
24%
High >$50K
Med $30-$50K 16%
High >$50K 0 24% 20
High >$50K 0
24% 20
Save every
pay 0
30%
20
55% 60%
61%
55%
40
60
61%
60%
61%
40
60%60
40
59%
60
40
17%
Savings
pattern
Save when
60%
30%
Save every
can
pay
60%60
33%16%
23%
33%
80
100
23%
16%
23%
80 16% 100
80
16% 100
80
11%
100
23%
11%
59%
Save every
Rarely
save 9% 30%
Save when
pay 17%
can
30%
Save every
0
20
pay
Save when 17%
Rarely save
can 9%
Save when 17%
can 09%
20
Rarely save
51% 40
60
11%
40%
23%
11%
80
100
23%
40%
23%
80
100
40%
Rarely save 09%
20
51% 40
60
40%
80
33%
20
40
52%
60
Good/V.Good 0
51%
51%
60%
40
60%
Average 11%
33%
Good/V.Good
64%
Good/V.Good
Poor/V.Poor 6% 33% 52%
64%
Average 11%
33%
Good/V.Good 0
20
40
64%
Average 11%
52%
Poor/V.Poor 6%
64%
Average 11%
0
20
40
6%
52%
Poor/V.Poor
Poor/V.Poor
06%patterns
20 52%
Card
payment
20
15%100
80
25%
15%
52%
52%
100
60
42% 15%
25%
15%
80
100
25%
42%
25%
80
100
42%
40
60
42%
80
100
40
60
80
100
26%
Pay full
balance
59%
60
60%
Understanding of personal Income
0
59%
52%
60
57%
17%
26%
57%
17%
Pay full
59%
27%
Carry balance 14%
each month
26%
57%
17%
Pay full
balance
0
40
80 17% 100
26%20
57%60
Pay full
59%
27%
Carry balance 14%
balance
each month
I am very satisfied with my current quality of life
59%
27%
Carry balance 14%
I am satisfied
current quality
0 with my 20
40 of life60
80
100
each month
I
am
not
satisfied
with
my
current
quality
of
life
59%
27%
Carry balance 14%
each month 0
20
40
60
80
100
Note: Percentages may not add to 100% due to rounding
0
6 FIN-Q Survey
20
40
60
80
100
Optimism towards
financial future
The Citi Fin-Q Survey shows more than half of Australians are
optimistic about their financial future – 56% to be exact. And
a further 15% say they are very optimistic leaving 29% who are
worried about their financial future.
Looking into these findings we see that age plays a part. With
time on their side, the 18-29 age group are more likely to be
optimistic about things to come, while older Australians are more
likely to fall into the ‘worried’ camp.
Comparisons with credit card limits are also interesting. Around
a third (32%) of those with credit card limits of $5,000 or less are
worried about their financial future compared with 20% of those
with a limit of $10,000 or more.
Some other obvious findings that probably don’t need to be backed
up by research – people who rarely save are more likely to be worried
about their financial future (50% in fact) and 62% of people who
admit they have a poor or very poor understanding of personal
finance are worried about what their financial future holds.
Using the above logic you’d think disciplined savers would be a
very positive bunch but only 26% of people who save money
from every single pay actually say they are very optimistic about
their financial future with a further 63% indicating a cautious
optimism. Then there are the 12% of disciplined (monthly) savers
who are actually worried about their financial future – perhaps
indicating a glass half empty approach to life….or a monstrous
mortgage!
On the other hand, a head in the sand mentality is evident
among the 34% of people who say they have a poor or very poor
understanding of personal finance but nonetheless also say they
are optimistic about their financial future.
18-29
18%
63%
19%
18-29
30-39
18%
14%
63%
53%
19%
33%
18-29
30-39
40+
18-29
18%
14%
15%
18%
63%
53%
54%
63%
19%
33%
31%
19%
Comparisons
Age
30-39 0 14%
40+ 15%
30-39 14%
0
40+ 15%
20
53%
40
54%
60
33%
80
31%
100
20
53%
40
54%
60
33%
80
31%
100
40+ 0 15%
20
54%
40
60
8031%
100
0 16%
20
40
52%
60
80
32%
100
Low <$5k
Credit card limit
16%
Low <$5k
Med $5-$10K
13%
52%
64%
32%
24%
Low <$5k
Med $5-$10K
High >$10K
Low <$5k
16%
13%
20%
16%
52%
64%
61%
52%
32%
24%
20%
32%
Med $5-$10K 0 13%
20
20%
High >$10K
Med $5-$10K 13%
0
20
20%
High >$10K
64%
40
60
61%
80 24% 100
20%
64%
40
60
61%
80
High >$10K 0 20% 20
40 61% 60
80 20% 100
40
80
0
Savings
pattern
26%
Save every
20
24%
60
63%
20%
100
100
12%
pay
26%
Save every
12%
Save when
pay
can
26%
Save every
12%
Save when
pay 9%
41%
Rarely save
can
26%
Save every
pay
Save when 0 12%
20
9%
41%
Rarely save
can
Save when 12%
20
can 0
41%
Rarely save 9%
59%
59%
63%
63%
63%
0
20
30%
30%
Good/V.Good
Average 6%
30%
Good/V.Good
Average 6%
34%
Poor/V.Poor 4%
30%
Good/V.Good
50%
12%
29%
12%
59%
40
60
8029%
50%
100
59%
40
60
29%
80
50%
100
50%80
100
80
100
12%
Rarely save 0 9% of personal
Understanding
finances60
20 41% 40
Good/V.Good
12%
29%
40
60%
60%
60
58%
58%
34%
58%
58%
62%
60%40
Average 06%
20
60
34%
62%
Poor/V.Poor 4%
60%
Average 6%
I am very optimistic
about
my financial
future
0
20
40
60
34%
62%
Poor/V.Poor 4%
I am optimistic about my financial future
Poor/V.Poor
I am worried
about 34%
my
future
04%
20financial40
60 62%
34%
12%
12%
12%
34%
80
100
34%
80
100
80
100
Note: Percentages
may 20
not add to 40
100% due 60
to rounding80
0
100
FIN-Q Survey 7
Budgeting –
what’s that?
Everyone knows they should make a budget, but of course the
reality is that not everyone does – even the most financially savvy
amongst us. Around one in five (19%) Australians say they make,
and stick to their monthly budget, 60% say that despite their
best intentions they make a budget but don’t always stick to it
and a further 21% say they aren’t organised enough to make a
budget at all.
Looking at the demographics, men are slightly more likely to
budget than women (25% of women say they fall into the ‘too
disorganised to budget’ camp compared to 18% of men).
Moving on, the research shows that 65% of Australians worried
about their financial future, make a budget but don’t always
stick to it. On the other side of the fence, 36% of people who
are very optimistic make a monthly budget and do stick to it.
Similarly, 44% of people with a poor or very poor understanding
of personal finance don’t budget at all. In summary, it may be fair
to say that people who could benefit most from budgeting, are
failing to do so.
Comparisons
24%
Low <$30K
Low <$30K
Med $30-$50K
24%
16%
61%
Low <$30K
Med $30-$50K
High >$50K
24%
16%
18%
61%
53%
23%
53%
23%
23%
53%
23%
23%
15%
67%
Med $30-$50K 0 16%
18%
High >$50K
20
61%
40
High >$50K 0 18%
20
40 67% 60
80
15% 100
20
40
80
100
0
Financial
future
V. Optimistic
V. Optimistic
Optimistic
67%
60
36%
18%
36%
61%
36%
V. Optimistic
18%
Optimistic
Worried 12%
80 23% 100
15%
60
61%
65%
46%
18%
46%
18%
21%
46%
18%
21%
23%
Optimistic 0 18%
Worried 12%
20
4061%
65%
60
80 21% 100
23%
Worried 0 12%
20
40
65%
60
80 23% 100
60
80
0
20
40
Understanding
of personal
finance
Good/V.Good
30%
Good/V.Good
Average
30%
14%
30%
Good/V.Good
Average 14%
Poor/V.Poor 6%
Average 0 14%
Poor/V.Poor 6%
69%
50%
69%
52%
18%
52%
18%
17%
52%
44%
17% 100
80
44%
100
You do not budget
because
you are
organised80
0
20
40 not that60
100
50%
60
You make a 06%
monthly budget
and 40
stick to it 60
20 50%
Poor/V.Poor
You make a budget but do not always stick to it
8 FIN-Q Survey
18%
17%
80
44%
20
69%
40
100
“25% of women say they fall into the ‘too disorganised to
budget’ camp compared to 18% of men”
FIN-Q Survey 9
Current approach
to savings
Regular savers are in the minority according to our research.
Fifty percent of Australians save money when they can, 22%
rarely save anything and 28% are disciplined enough to set aside
something every time they get paid.
The research really does speak for itself. Personal circumstances
can hinder the ability to save and for some it’s hand to mouth
– but there is a very strong link between low levels of saving,
low levels of satisfaction, low levels of optimism in terms of the
financial future and finally - a low level of personal financial
understanding.
The link to credit card payment patterns suggest those who carry
a balance each month rarely save while “transactors” – those who
pay the full balance each month – have a much greater capacity
to put money aside on a regular basis.
45%
V. Satisfied
Comparisons
45%
V. Satisfied
29%
Overall
quality of
life
Satisfied
45%
29%
V. Satisfied
Satisfied
45% 49%
13%
29%
13%
49%
0
20
40
29%20
Satisfied 0
40
49%
Not Satisfied 13%
V. Satisfied
Not
Satisfied
Not Satisfied
Not Satisfied
45%
45%
11%
11%
52%
45%
52%
19%
11%
19%
52%
45%
60
52%
60
0 13%
20
40
49%
60
80
38%
100
0
20
40
60
80
100
V. Optimistic
48%
48%
39%
39%
13%
13%
Optimistic
V. Optimistic
Optimistic
31%
48%
31%
53%
39%
53%
16%
13%
16%
Financial
future
V. Optimistic
48% 50%
V. Optimistic
Worried 11%
31%
Optimistic
50%
Worried 11%
0
20
40
31%20
Optimistic 0
40
50%
Worried 11%
0
Worried 11%
20
39%
53%
60
53%
60
40
50%
0
20
40
Understanding
of personal
finance
Good/V.Good
Good/V.Good
39%
39%
Average
Good/V.Good
Average
24%
39%
24%
53%
53%
Card payment
010%pattern
20 46%
Poor/V.Poor
0
20
Pay full
balance
Pay full
balance
39%
39%
Pay full
Carry balance
eachbalance
month
Carry
Pay full
eachbalance
month
39%
21%
21% 39%
38% 13%
16%
38%
80
100
80 16% 100
38%
60
80
38%
100
60
80
100
47%
47%
14%
14%
47%
23%
14%
23%
47%
Good/V.Good
Poor/V.Poor 10% 39% 46%
24%
53%
Average
46%
Poor/V.Poor 10%
0
20
40
60
24% 20
Average 0
40 53% 60
46%
Poor/V.Poor 10%
10 FIN-Q Survey
38% 11%
19%
38%
80
100
80 19% 100
38%
14%
44%
23%
44%
80
100
80 23% 100
44%
40
60
80
44%
40
60
80
49%
49%
100
100
52%
52%
10%
10%
52%
10%
30%
30% 10%
52%
0
20
40
60
80
49%
Carry balance 0 21% 20
40
60
8030%
each month
You set aside/save some money everytime you get paid
21% some when you
49%
30%
Carry
Youbalance
set aside/save
0
20
40 can 60
80
each month
You rarely set aside or save money when you get paid
100
100
0
20 add to 100%
40
60rounding80
Note: Percentages
may not
due to
100
100
Paying off the
credit card
Men are more likely to pay off their full outstanding credit card
balance each month (47%) compared with women (34%). There
are other findings worth noting when we look at some of the
demographics – let’s start with ‘age’.
There is not a huge difference in behaviour amongst age groups
but those aged 40 and over do have a tendency (and probably
a greater capacity) to pay off the full outstanding balance each
month compared with younger age groups. Those aged 30-39
are most likely to only make the minimum payment.
Annual personal income reveals that 46% of people with an
income of $50,000 or more pay their full credit card balance each
month compared with 39% of low income earners on $30,000 per
year or less. Interestingly, the group of medium income earners
on $30,000 - $50,000 per annum are most likely to only pay the
minimum balance out of all income groups surveyed.
Whether you have children also plays a part in credit card
repayment trends. Forty seven percent of people without
children pay off their balance in full each month compared with
37% of people with children.
Finally – level of financial education influences credit card habits of
respondents. Fifty four percent of Australians who say they have a
good or very good level of personal financial understanding pay the
full balance each month compared with 26% of those with a poor
or very poor level of understanding. More than one in three (36%)
with a poor or very poor understanding only make the minimum
payment. Those falling in the middle with an average level of
personal financial understanding are most likely to pay more than
the minimum but still carry a balance into the next month.
18-29
37%
48%
48%
15%
15%
30-39
30-39
18-29
37%
37%
37%
42%
42%
48%
21%
21%
15%
40+
18-29
40+
30-39
45%
37%
45%
37%
41%
48%
42%41%
14%
15%
14%
21%
37%
18-29
Comparisons
Age
0
0
20
20
37%
45%
40
40
60
60
42%
41%
80
80
100
100
21%
14%
40+ 0
20
45%
40
6041%
80
14%100
20
40
60
80
100
30-39
40+
0
Low <$30K
39%
39%
43%
43%
17%
17%
Med $30-$50K
MedLow
$30-$50K
<$30K
35%
35%
39%
37%
37%43%
28%
28%
17%
High
Low >$50K
<$30K
>$50K
MedHigh
$30-$50K
46%
39%
46%
35%
43% 46%
46%
37%
8%
17%
28%8%
Low <$30K
Annual
personal income
Med $30-$50K
High >$50K
0
0
High >$50K 0
0
Have children
20
20
35%
46%
40
40
20
46%
20
60
60
37%
80
80
100
100
28%
8%
40
60 46% 80
100
8%
40
60
Yes
Yes
37%
37%
43%
43%
Yes
No
No
37%
47%
47%
43%
Yes
37%
43%
No
0
0
20
20
47%
40
40
60
60
Understanding of personal finance
No
0
Good/V.Good
Good/V.Good0
47%
20
40
60
54%
20 54%
40
60
Average
Average
Good/V.Good
32%
32% 54%
50%
50%
Poor/V.Poor
Good/V.Good
Poor/V.Poor
Average
26%
54%
26%
32%
38%
38% 50%
46%
80
100
20%
20%
20%
10%
10%
43%
43%
20%
80
80
100
100
10%
80
10%
100
37%
37%80
9%
100
9%
43%
43%
37%
18%
18%
9%
36% 9%
37% 36%
18%
0
20
40
60
80
100
0
20
40
60
80
100
32%
50%
18%
Average
26%
38%
36%
Poor/V.Poor
You pay off the full outstanding balance each month
You pay off 0more than20
the minimum
payment
a balance
4038%
60and carry
80
100
26%
36%
Poor/V.Poor
into the next month
You make the minimum payment only and carry a balance into the
0
20
40
60
80
100
next month
Note: Percentages may not add to 100% due to rounding FIN-Q Survey 11
“And it gets more interesting – people with a mortgage
or who are renting have higher levels of optimism and
satisfaction than people who’ve paid off their home.”
12 FIN-Q Survey
Current home
ownership status
This subject threw up an interesting question. Which is better satisfaction or optimism? The research suggests that Australians
who currently own their home or apartment outright are more
likely to be very optimistic about their financial future (31%) than
very satisfied about their overall quality of life (21%). And it gets
more interesting – people with a mortgage or who are renting
have higher levels of optimism and satisfaction than people
who’ve paid off their home. Thirty nine per cent of people who
have a mortgage are very satisfied with their quality of life as are
33% of people who are renting – this is significantly higher than
the 21% response from outright homeowners.
Other interesting findings:
Comparisons
18-29 4% 25%
Age
9%
18-29 4%
30-39
25%
1% 14% 8%
48%
1% 14% 8% 3% 3%
45%
48%
39%
2%
18-29 4%
30-39
40+ 9%
25%
32%
1% 14% 8%
48%
45%
3% 3% 2% 39%26%
39%
30-39 09%
40+
20
32%
45% 40
40+ 0
20
32%
40
39%60
0
20
40
60
2%
1%
80
3%60
3%
39%
39%
2%
26%
2%
1%
2% 80 26%
100
100
1%
• 26% of over 40s are currently renting
80
100
• 8% of people live with their parents
• 33% of people with children are renting compared with 42%
of people with no kids
• Only 8% of people with no kids own their home outright
compared with 21% of people with children
• 40% of men are renting versus 33% of women
21%
V. Satisfied
Overall
quality
of life
39%
4%
33%
1% 1%
V. Satisfied
21%
18%
39%
41%
4%
33%
32%
21%
V. Satisfied
18%
Not Satisfied 8%
29%
39%
41%
5% 5%
1% 1%
2%
3%
4%
33%
4% 51% 32%
1% 1%
Satisfied 0 18%
Not Satisfied 8%
20
29%
2%
40
41%
5% 5%
100
Not Satisfied 08%
20
29%
2%
40
5% 5%
2% 3%
60
80
4%
32%
51%
2% 3%
60
51%80
100
0
Financial future
20
2%
40
60
80
100
V. Optimistic
31%
V. Optimistic
17%31%
36%
39%
2%
31%
36% 4% 4%
2%
31%
32%
3%
31%
36%
2%
31%
V. Optimistic
17%
36% 39% 5%3% 4% 4% 48%32%
Optimistic
Worried 7%
1%
3%
40
60
80
39%
4% 4%
32%
Optimistic 0 17% 20
36%
5%3%3%
48%
Worried 7%
100
1%
You currently own your own home or apartment outright
20
40 5%3% 60
80
100
36%
48%
Worried 07%
You are currently paying a mortgage/home loan on your own home
1%
or apartment
0
20
40
60
80
100
You do not live with your parents, own your own home or apartment
but are currently living rent or mortgage free
You currently live with your parents rent free
You are currently living with your parents and paying rent/board
You are currently renting
FIN-Q Survey 13
An underinsurance
epidemic
The Citi Fin-Q Survey confirms previous reports that Australians
are underinsured. Around one in three Australian adults (34%)
have enough insurance to ensure their loved ones won’t suffer
financially in the event of their own death, sickness or disability.
A further 18% have life insurance – but that’s it. But the statistic
that is the big worry is the fact that 48% of people say they don’t
have any insurance at all, that’s almost half the adult Australian
population…and real food for thought.
Comparisons
Total results
Age is another factor in responses and as you’d expect the older
age groups have more protection in place than younger ones –
but it could be argued – still not nearly enough.
Ironically, 39% of Australians who are very optimistic about their
financial future don’t have any insurance. On the other side of
the fence though, 51% of this same group have fully planned for
the eventuality of death, illness or disability to ensure their family
won’t suffer financially.
Those worried about their financial futures are much more
complacent about insurance and perhaps there’s an element
of the double-edged sword, with 65% of these ‘worried’ people
having no insurance.
Financial literacy and awareness again comes into play here. Forty
three percent of people with a good or very good understanding
of personal finance said they have enough insurance to support
their family financially compared with 14% of those with a poor or
very poor understanding.
34%
18%
48%
Total
34%
18%
48%
0
34%
34%
20
18%
18%
40
60
48%
48%
80
100
0
20
40
60
80
100
0
0
20
20
40
40
60
60
80
80
100
100
Total
Total
Looking at some demographics, men are more likely to have
sufficient insurance (39%) compared with women (29%) and
looking at it from another perspective, 54% of women don’t
have any insurance with the equivalent result for men standing
at 43%.
Another worrying result is the number of Australians with children
who said they don’t have any insurance - 45%. This increases to
53% for those with no children.
Total
Age
18-29
23%
18-29
30-39
18-29
18-29
30-39
40+
30-39
30-39
40+ 0
23%
19%
35%
13%
23%
19%
23%
19%
35%
13%
39%
23%
35%
13%
35%
13%
39%
20
40 23% 60
40+
40+ 0
0
0
19%
58%
20
39%
39%
40
23%
23% 60
20
20
40
40
60
60
58%
52%
58%
58%
52%
38%
52%
52%
38%
80
100
80
38%
38%
100
80
80
100
100
Financial future
V. Optimistic
51%
51%
V. Optimistic
37%
Optimistic
51%
V. Optimistic
Optimistic
51%
V.
37%
Optimistic
18%
17%
Worried
37%
Optimistic
37%
Optimistic
Worried 0 18% 2017%
18%
Worried 0 18%
Worried
2017%
17%
10%
39%
10%
39%
42%
39%
39%
42%
21%
21%
10%
10%
65%
40
21%
21%
40
60 65%
42%
42%
80
100
60 65%
65%
80
100
80
80
100
100
0
20
40
60
0
20
40
Understanding
of personal
finance 60
Good/V.Good
43%
43%
Good/V.Good
30%
Average
43%
Good/V.Good
43%
Good/V.Good
30%
Average
18%
Poor/V.Poor 14%
30%
Average
30%
Average
18%
20
Poor/V.Poor 0 14%
16%
41%
16%
41%
49%
41%
41%
49%
21%
21%
16%
16%
68%
21%
21%
40
6068%
49%
49%
80
100
0 14%
20
40
80to pass 100
18%
Poor/V.Poor
14% insurance
18% to ensure
68%
You have enough
that60
if68%
you were
Poor/V.Poor
away, become sick or disabled you and your family would not
0
20
40
60
80
100
0
20
40
60
80
100
suffer financially
You currently have life insurance but no other type of insurance
(i.e. health or critical illness insurance)
You do not currently have any insurance
14 FIN-Q Survey
“Another worrying result is the number of Australians
with children who said they don’t have any insurance 45%. This increases to 53% for those with no children.”
FIN-Q Survey 15
How much is enough
to retire on?
The results of this question warrant a more detailed look, so
there are a few more demographics than normal here to paint a
clearer picture.
Essentially one in two Australians (51%) either have no idea how
much they need to fund a comfortable retirement or have not
started planning for their retirement. This leaves 13% who are
prepared (meaning they know how much they need to fund a
comfortable retirement and feel they are on track to reach their
goal) and another 36% of people who aren’t entirely sure how
much it will take to fund a comfortable retirement but have at
least got the ball rolling with some savings and investments.
Although the figures between the sexes are quite low, men are in
a slightly better position with 16% saying they know how much
they need to fund a comfortable retirement and how to get there
compared with only 10% of women.
Slightly more disarming is the number of over 40s who haven’t
quite got a grasp on their retirement savings. One in five (20%)
over 40s know how much they need to fund their retirement and
are confident they are on track, 42% are not sure how much they
need but have some savings and investments under their belt,
23% don’t have any idea how much they will need and a further
15% haven’t started planning for retirement yet – even though
retirement may not be too far away for some.
The state of play doesn’t look that much better when income
is considered either. Around one in two (49%) from the highincome bracket ($50,000 and above) are at that mid-way point
where they don’t know how much they will need, but have done
something to kick-start their retirement savings. Still many of
Australia’s highest income earners either have no idea how much
they will need (18%) or haven’t started (17%).
Low income individuals on less than $30,000 per year aren’t
faring well either. A high 33% of these people don’t have any
idea how much they’ll need to fund a comfortable retirement and
38% haven’t started planning for it.
16 FIN-Q Survey
Turning to the more human side of the research – we can see that
preparation is the key to financial optimism. In the highest result
by far, 43% of Australians who are very optimistic about their
financial future know how much they need in retirement and are
actively planning towards it. Only 1% of people worried about
their financial future are in the same boat and a further 46% of
this group haven’t started planning for retirement.
Job security throws up some interesting findings. While feeling
secure in your job may mean you have more of an idea about
planning for retirement than those who don’t feel secure, it
doesn’t necessarily mean this is happening. The results show
that 35% of insecure people don’t know how much they need
to fund their retirement compared with 21% of people secure in
their roles who do, yet 23% of insecure people have done nothing
to plan for their retirement against 28% of secure people…not a
significant gap. Once again – actions speak louder than words.
Wrapping up this section is level of personal financial
understanding – once again, another key driver of retirement
preparedness. But even at the most positive end of the spectrum,
a good deal of improvement is needed. The best of the bunch
are the 24% of Australians who have a good or very good
understanding of personal finances and know how much they
need to fund their retirement and are confident they are on track.
This figure drops to 6% for those with an average understanding
and 2% of people with a poor or very poor understanding. Down
at the bottom of the scale are the 44% of Australians who have
the lowest level of financial understanding and have not started
planning for retirement.
“Slightly more disarming
is the number of over 40s
who haven’t quite got a
grasp on their retirement
savings. . . . 23% don’t have
any idea how much they
will need and a further 15%
haven’t started planning for
retirement yet. . .”
43%
43%
V. Optimistic
V. Optimistic
Optimistic 11%
Optimistic 11%
Age
18-29 7%
35%
27%
31%
18-29 7%
10%
30-39 7%
18-29
35%
31%
35%
27%
24%
27%
31%
35%
31%
24%
24%
35%
23%
15%
35%
30-39 10%
20%
40+
30-39 10%
40+
40+
31%
31%
42%
0 20% 20
20%
0
20
0
20
40
42%
42%
40
40
Low <$30K 9%
19%
Low <$30K 9%
12%
Med $30-$50K 9%
Low <$30K
19%
19%
Med $30-$50K 12%
High >$50K 16%
Med $30-$50K 12%
High >$50K
High >$50K
0 16%
16%
0
0
60
23%80
23%
80
80
60
60
33%
33%
33%
36%
36%
49%
36%
20
40
49%
49%
40
40
20
20
Feel secure
Feel secure
15%100
15%
100
100
26%
26%
38%
27%
38%
60
80
18%
18%
80
80
60
60
17% 100
17%
100
100
36%
10% 11%
V. Optimistic
Optimistic 11%
V. Optimistic
43%
46%
43%
36%
22%
36%
10% 11%
21%
10% 11%
46%
37%
46%
40
40
60
60
80
80
100
100
37%
37%
21%
21%
34%
34%
20
20
28%
28%
35%
35%
40
40
23%
23%
60
60
80
80
100
100
24%
24%
45%
45%
33%
33%
Poor/V.Poor 2% 18%
Poor/V.Poor 2% 18%
0
20
0
20
15%
15%
29%
29%
36%
36%
40
40
16%
16%
31%
31%
44%
44%
60
60
80
80
100
100
20
40
37%
37%
40
40
20
20
60
60
60
80
46%
46%
80
80
28%
Feel secure 15%
Feel secure 15%
Don't feel 8%
secure
37%
37%
21%
21%
28%
28%
23%
34%
20
34%
40
35%
60
35%
80
23%
100
23%
20
20
40
40
60
60
80
80
100
100
24%
You have not started planning for your retirement
100
100
21%
35%
You have no idea how much you’ll need to fund a comfortable
retirement
100
37%
34%
You are not sure how much you will need to fund a comfortable
retirement but you have some savings and investments already
22%
21%
46%
22%
21%
15%
Good/V.Good
46%
46%
You know how much you will need to fund a comfortable retirement
and already have enough set aside to be confident you are on track
43%
Don't feel 08%
secure
Don't
feel 8%
secure
0
0
Don't feel 8%
Don't
feel 8%
secure
secure
0
0
Average 6%
Average 6%
V. Optimistic
Feel secure
15%
15%
Good/V.Good
Good/V.Good
27%
17%
27%
18%
21%
21%
38%
26%
22%
22%
37%
37%
20
20
10% 11%
10% 11%
Job security
Financial future
Optimistic 11%
17%
Worried
Optimistic 11%
1%
0 17%
Worried
Worried 1%17%
01%
0
46%
46%
17%
Worried
Worried 1%17%
01%
0
Comparisons
36%
36%
45%
15%
16%
45%
29%
45%
15%
16%
31%
15%
16%
FIN-Q Survey 17
24%
Good/V.Good
Average 6% 24% 33%
Good/V.Good
An investment
hypothetical
Presented with a hypothetical situation of being given a lump sum
of money equal to six month’s salary, most Australians (53%) said
they would have some idea of what to do with it, 26% would know
exactly what they would do with it but 22% would have no idea.
Comparisons
Gender
Not surprisingly, 18-29 year olds are most likely to fall into the
last category (31%) compared with 21% of 30-39 year olds and
16% of over 40s.
For some reason having children makes a difference too with
23% of people with kids saying they would know how to go about
investing this amount of money compared with 30% of those
with no kids.
And once again the male versus female debate rears its head with
almost a third (32%) of men saying they would know exactly what
to do if they were given six month’s worth of salary compared
with 20% of women – another great argument to support the
need for increased financial education amongst women.
And on the topic of financial education, the following effectively
sums up the general link between financial education and
knowledge of investing. Almost half (48%) of people with a
good or very good understanding of personal finance would
know exactly what they’d do if they were given this amount of
money to invest, 63% of people with an average understanding
of personal finance understanding would have some idea what
to do and 64% of people with a poor or very poor understanding
would have no idea what to do.
Male
32%
55%
14%
Male
Male
32%
32%
55%
55%
14%
14%
Female
20%
51%
Female
Female 0
20%
20% 20
0
0
20
20
30%
51%
40
51%
60
30%
80
30%
100
40
40
60
60
80
80
100
100
Age
18-29
21%
48%
31%
18-29
18-29
30-39
21%
21%
27%
48%
48% 52%
31%
31%
21%
30-39
30-39
40+
27%
27%
28%
40+ 0
40+
0
0
52%
52%
56%
28%20
28%
20
20
40
40
40
21%
21%
16%
56%
60
56%
60
60
80
80
80
16%100
16%
100
100
48%
Good/V.Good
Good/V.Good
Good/V.Good
Average
Average
Average
Poor/V.Poor
13%
48%
48%
13%
13% 36%
63%
63%
63%
45%
6%
45%
45%
6%
24%6%
64%
24%
24%
36%
Poor/V.Poor 0
20
40
60 64% 80
100
36%
64%
Poor/V.Poor
40 to six month’s
60
80 to invest,
100
If you were0given an 20
amount equal
salary
0
20
40
60
80
100
you would know exactly what to do with it
If you were given an amount equal to six month’s salary to invest,
you would have some idea what to do with it
If you were given an amount equal to six month’s salary to invest,
you would have no idea what to do with it
18 FIN-Q Survey
“And once again the male versus female debate rears its
head with almost a third (32%) of men saying they would
know exactly what to do if they were given six month’s
worth of salary (to invest) compared with 20% of women. . .
FIN-Q Survey 19
Formal retirement plan
– who has one?
The Citi Fin-Q Survey doesn’t inspire confidence in the country’s
preparedness for retirement. The key result here is this: 83% of
Australians don’t have a formal retirement plan that has been
prepared by a finance professional. Included in this group are:
• 91% of 18-29 year olds, 89% of 30-39 year olds and 73% of
over 40s
• 92% of people with an annual personal income of less than
$30,000 and 82% of people with an income of more than
$50,00 per year
• 66% of those who are very satisfied with their overall quality
of life and 91% who are not satisfied
• 67% who are very optimistic about their financial future and
93% who are worried
• 71% who save money from every pay and 94% who rarely save
It also includes 73% of people who rate themselves as having a
good or very good understanding of personal finance and 96% of
people who rate themselves as poor or very poor.
One of the questions that may come to mind is “so what is
driving optimism”? The answer in this case doesn’t seem to be
preparedness – although to be fair this question doesn’t address
“do it yourself retirement plans”.
18-29 9%
91%
18-29 9%
Comparisons
91%
30-39 11%
89%
11%
18-29 9%
30-39
89%
91%
27%
40+
18-29 9%
30-39
40+ 0 11%27%20
73%
91%
89% 73%
60
Age
0
20
30-39 11%
27%
40+
40
89%
100
60
73%
80
100
40
60
73%
80
100
20
33%
40
60
67%
80
100
80
100
60
83%
93%
80
100
60
80
100
60
80
100
80
100
80
100
60
80
100
73%
60
80
100
80
100
80
100
0
20
40
80
Note:
Percentages
due 60
to rounding
4% may not add to 100%
96%
Poor/V.Poor
100
27%
0
V. Optimistic
V. Optimistic
Financial
future 33%
Optimistic
V. Optimistic
67%
17%
83%
17%33%
83%67%
Worried 7%
33%
V. Optimistic
17%
Optimistic
Worried 07%
20
93%
40
0
17%
Optimistic
Worried 7%
20
40
0
Worried 7%
20
40
20
40
Savings pattern
0
29%
Save every
pay
29%
Save every
pay
Save when 15%
can
Save
Save every
when 15%29%
pay
can
Rarely save 6%
29%
Save every
15%
6%
Save when
Rarely
save
20
pay 0
can
0
20
Save when 15%
6%
Rarely save
can
67%
83%
93%
60
93%
71%
71%
85%
85%71%
94%
40
40
71%
85%
94%
60
60
85%
94%
0
Rarely save 6%
20
40
Good/V.Good 0
27%20
40
Good/V.Good
27%
Average
Good/V.Good
Average
73%
89%
11%27%
89%73%
0
Average 11%
Yes
Poor/V.Poor 4%
No
0
94%
11%
Poor/V.Poor 4%
27%
Good/V.Good
11%
Average 04%
Poor/V.Poor
20
20 FIN-Q Survey
80
20
40+
0
40
20
20
96%
40
40
40
73%
89%
96%
60
60
89%
96%
60
80
100
Up-to-date
will anyone?
Along with insurance, having an up-to-date will seems to be
another thing that gets left to chance.
18-29 7%
Comparisons
Only 27% of Citi Fin-Q respondents say they have a current will,
leaving 73% who don’t.
Age
The sexes are pretty much on par but there are big differences
(as you’d expect) amongst the age groups. More than nine out
of ten (93%) 18-29 year olds said they don’t have a current will.
This decreased to 78% of 30-39 year olds and decreased further
to 54% of over 40s.
There are also concerns to be had when 66% of people with
children say they don’t have an up-to-date will and this rises to
85% for people with no offspring.
High income earners are also leaving things to chance – 67% of
people with incomes above $50,000 don’t have a will, compared
to 79% of medium income earners ($30,000 - $50,000) and
83% of low income earners (below $30,000).
The level of financial education also doesn’t appear to have much
impact on whether people have a current will as evidenced by the
fact that 60% of people who rate themselves as having a good
or very good understanding of personal finance don’t have an
up-to-date will.
93%
18-29 7%
30-39
18-29 7%22%
78%
93%
22%
30-39
18-29 7%22% 46%
40+
30-39
78%
93%
78% 54%
46%
20
46%
20
40
0
20
46%
40
60
80
54%
100
0
20
40
60
80
100
100
80
100
80
100
85%
60
85%
80
100
60
85%
60
80
100
80
100
60
80
100
80
100
40+ 0
30-39
40+
0
40+
93%
22%
60 54%80
78%
54%
60
80
40
17%income
Low <$30K
Annual
personal
17%
83%
21%
17%
79%
83%
Med $30-$50K
Low <$30K
>$50K
MedHigh
$30-$50K
21%
17%
21%33%
79%
83%
67%
79%
High >$50K 0
Med $30-$50K
High >$50K
0
33%
20
21%
33%
20
40
40
60 67% 80
79%
67%
60
80
0
20
33%
40
60
20
40
60
High >$50K
Have children
0
67%
Yes
34%
66%
Yes
34%
66%
Yes
34%
66%
15%
No
Yes
No
100
83%
MedLow
$30-$50K
<$30K
Low <$30K
100
100
85%
34%
66%
15%
No 0 15%
20
40
0
No 0 15%
20
40
20
40
0
Good/V.Good
20
40
40%
60%
Good/V.Good
40%
60%
Average
Good/V.Good
22%40%
78% 60%
22%
Average
Good/V.Good 6% 22%40%
Poor/V.Poor
Average
78%
94%78%
Poor/V.Poor 06%
20
22%
Average
Poor/V.Poor 6%
0
20
Yes
40
0
No
Poor/V.Poor 6%
40
80
100
80
100
0
20
40
60
80
100
20
40
94% 60
78%
94%
60
60%
94%
60
FIN-Q Survey 21
Overall level of
financial understanding
Only 9% of Australians rate themselves as having a very good
level of financial understanding. Around one in three (32%) give
themselves a good rating but the highest response fell in the average
category (47%). At the lower end of the scale, 12% say they have a
poor understanding and 1%, a very poor understanding.
Comparisons
There were some differences between men and women. Forty six
percent of men say they have a good or very good understanding
compared with 35% of women.
The age demographics also showed some interesting results.
The 18-29 age group are a confident bunch with 44% saying
they have a good or very good financial understanding. This was
virtually the same result given for the over 40s camp at 45%.
However, the level of understanding fell back to 33% for 30-39
year olds. Just what our expectations are in terms of a ‘very
good’ understanding is a bit of a grey area, but only 10% of those
closest to retirement – the over 40s - rate themselves as having
a very good level of financial understanding.
If knowledge is passed on from parent to child then schools may
need to do more to address financial education. Thirty nine
percent of people with children say they have a good or very
good financial understanding. Further Citi Fin-Q results in this
report will also support the need for greater financial education
in the classroom.
Other findings show:
• 40% of those with a low credit limit (less than $5,000) have
a good/very good level of financial understanding compared
with 52% of those with a credit limit of $10,000 or more
• 70% of people who are very satisfied with their overall quality
of life have a good or very good level of financial understanding
compared with 26% of people who are not satisfied
• 25% of people who are worried about their financial future
have a poor level of financial understanding compared with 3%
of those who are very optimistic about their financial future
• 54% of people who pay off their full credit card balance
each month have a good or very good level of financial
understanding compared with 31% of those who carry a
balance each month
Male 11%
35%
42%
12%
Male 11%
35%
42%
12%
Female 7%
Male 11%
28%
35%
53%
42%
Female 07%
28%
20
40
53%
60
80
Female 07%
28%
20
40
53%
60
80
12%
100
1%
20
40
60
80
100
1%
Gender
0
Age
18-29
10%
34%
45%
1%
12%
12%
1%
1%
12%100
1%
10%
1%
10%
18-29 7%
30-39
27%34%
51%45%
18-29 10%
7%
30-39
40+ 10%
34%
27%
35%
45%
51%
45%
30-39 07%
40+ 10%
27%
20
35%
40
0
40+ 10%
2035%
40
60 45% 80
40
60
Have children
0
20
Yes 9%
51%
60
30%
45%
80
10%
15%
1%
1%
10%
15%
9%1%
1%
1%
15% 100
9%
1%
1%
9%100
1%
100
80
48%
12%
1%
Yes 9%
30%
48%
No 8%
Yes 9%
35%
30%
47%
48%
No 08%
2035%
40
60 47%
No 08%
Very
good
Good
35%
20
40
60
Average
0
Poor
20
40
60
47%
12%
80
1%
10%
12%
1%
1%
10%100
1%
80
10%
100
1%
80
100
Very poor
22 FIN-Q Survey
“Further Citi Fin-Q results in this report will also support
the need for greater financial education in the classroom.”
FIN-Q Survey 23
“The stand out result in the age groups is the fact that
63% of 30-39 year olds are not confident – this is 10%
higher than the other two age groups.”
24 FIN-Q Survey
Comfortable in
retirement?
The majority of Australians are not confident they have enough
savings to fund a comfortable retirement. Forty two percent
are not very confident and 15% are not confident at all. On the
positive side of the fence, 37% of people are confident and 7%
very confident.
The stand out result in the age groups is the fact that 63% of
30-39 year olds are not confident – this is 10% higher than the
other two age groups. Perhaps this could be reflective of the fact
there are many financial pressures during this time like buying a
house and having children – let alone thinking about retirement.
Where incomes are concerned, 52% of people on more than
$50,000 per year are confident they will have enough saved
up to have a comfortable retirement. This compares to 42% of
medium income earners and 24% of people on income levels of
less than $30,000. Added to this, 28% of low-income earners
are not at all confident they’re on track for retirement compared
with 4% of those on more than $50,000 per year.
It stands to reason that people who are very optimistic about their
financial future are also optimistic about their retirement. Eighty
seven percent of those very optimistic folk have confidence in
their current retirement plan but 98% of those worried about
their financial future are not confident.
Finally, of those people who save money from every pay, 38%
are still not confident they will be able to fund a comfortable
retirement.
Comparisons
Low <$30K
Annual
personal income
47%
23%
Low <$30K
6%
MedLow
$30-$50K
1%
23%
<$30K
47%
37%
1%
Med $30-$50K 6%
8%
>$50K 6%
MedHigh
$30-$50K
37%
43%
37%
High >$50K 08%
20 43%
High >$50K 8%
0
20
23%
1%
0
47%
28%
28%14%
44%
44%
44%
44%
43%
20
Financial future
28%
14%
4%
14%
40
60
44%80
100
4%
40
60
44%
80
4%
100
40
60
80
100
V. Optimistic
39%
48%
11%
V. Optimistic
V. Optimistic
Optimistic
39%
39%52%
48%
2%
11%
5%
2%
11%
1%
Optimistic
Worried 2%
1%
Optimistic
52%
58%
52%
1%
Worried 02%
20
Worried 2%
0
20
0
48%
42%
40%
42%
58% 40
58%
20
42%
2%
5%
5%
60
80
40%
100
40
60
40%
80
100
40
60
80
100
Savings pattern
Save every
pay
15%
Save every
pay
Save every
when
Save
can
pay
Save when
can
Rarely
save
Save when
15%
3%
15%
46%
46%
39%
3%
39%
3% 19% 39%
3%
can
Rarely save 03% 19% 20
Rarely save 3% 19%
0
20
Very confident
20
Confident 0
46%
48%
34%
4%
34%
4%
11%
4%
34%
48%
41%
40
41%
11%
36%
48%
11%
60
80
36%
100
41%
40
60
36%
80
100
40
60
80
100
Not very confident
Not at all confident
FIN-Q Survey 25
Can I have some
money kids?
While in some countries parents expect their children to look
after them by providing financial support in their later years,
the majority of Australians don’t necessarily share the same
opinion. Four percent of people believe it is very important to
receive financial support from their adult children, 22% think
it’s important but a high 75% don’t consider it very important or
important at all.
And it may be surprising to learn that the oldest category of
respondents – the over 40s, led the charge with 38% of this
group saying that it’s not at all important for their kids to provide
financial support compared with 26% of the 18-29 age group.
As expected there are some differences between child-free
respondents and those with kids. Forty percent of people with no
children said financial support is not at all important compared
with 25% of those who do have kids.
When faced with a bleak financial future the results indicate a
greater desire for help from offspring. People who are worried
about their financial future are more likely to say it’s important
that children provide financial support than those who are
optimistic or very optimistic.
The same sort of picture emerges when confidence in retirement
savings is taken into consideration. Those who aren’t confident
they have enough to provide a comfortable retirement are more
likely to say it’s important whereas those who are confident are
more likely to say it’s not at all important.
18-29 3% 25%
Comparisons
Age
46%
26%
3% 20%
25%
18-29 5%
30-39
46%
48%
26%
27%
3% 20%
25%
18-29 5%
30-39
40+ 3% 21%
46%
48%
39%
26%
27%
38%
0
20
20%
30-39 5%
40+ 3% 21%
0
20
40+ 3% 21%
0
20
40
60
48%
39%
80
27%
38%
100
40
39%
60
80
38%
100
40
60
80
100
7% 13%
V. Optimisticfuture
Financial
31%
7% 22%
13%
V. Optimistic 3%
31%
49%
49% 26%
7% 13%
V. Optimistic 3%
24%
Optimistic
Worried 4% 22%
31%
49%
41%
49% 26%
30%
0
20
22%
Optimistic 3%
Worried 4% 24%
0
Worried 4%
20
24%
40
40
49%
49%
41%
41%
Confidence
savings
0 in retirement
20
40
60
80
26%
30%
100
60
80
30%
100
60
80
100
Confident 3% 20%
40%
37%
Confident 3% 20%
40%
37%
Not 4% 22%
confident 3% 20%
Confident
47%
40%
26%
37%
Not 04% 22%20
confident
Very important
Not 04% 22%20
Important
confident
Not very important
0
20
Not at all important
40 47% 60
8026%
100
40 47% 60
8026%
100
40
80
100
60
26 FIN-Q Survey
Rainy day savings
Total
Total
19%
10% 4% 12% 5% 7% 3%
23%
15%
19%
3%
10% 4% 12% 5% 7% 3%
23%
15%
3%
Everyone knows the importance of rainy day savings and the
general rule of thumb is that three months’ salary is good to
have on hand, but faced with job loss and having to maintain all
the usual expenses including a mortgage and food bills, many
Australians wouldn’t last one month on their current savings, let
alone three months.
The results showed:
• 19% would last less than 1 week
• 10% would last 2 weeks
20
40
60
80
100
0
20
40
60
80
100
Comparisons
Age
23%
18-29
12% 7% 12% 4% 11% 4% 12% 12%
3%
12% 7% 12% 4% 11% 4% 12%
10%
15%
6% 3% 18%
3%
2%
3% 4%
25%
10%
15%
6% 3% 18%
30-39
4%
35%
40+ 11% 8% 9% 7%
2%
3% 4%
3%
1%3%
60
80
4%
35%
40+ 0 11% 8%20 9% 7%40
23%
25%
18-29
30-39
• 3% would last 5 to 6 weeks
3%
20
0
0
1%3%
40
60
12%
14%
14%
19%
19% 100
80
100
• 23% would last more than 3 months
• 15% don’t know how long their savings would last
Where the sexes are concerned, on average men would last 7.6
weeks compared with women at 6.6 weeks. The average length
of time for over 40s is 9.1 weeks with 35% of this age group
saying they would last more than three months. The 18-29 year
olds would last 5.5 weeks on average, with the middle age group
(30-39 year olds) 6.2 weeks on average. Slightly concerning is
the fact that one in four (25%) 30-39 year olds would last less
than one week on their current savings if they lost their job.
Income is of course a factor in this question. Around a quarter
(24%) of those on less than $30,000 don’t have any idea how
long they could get by on their savings and even 15% of those on
more than $50,000 per year don’t know (although 28% of this
high income group would last more than three months).
One of the strongest links is in relation to credit card limits. Forty
six percent of those with credit card limits over $10,000 could last
more than three months. On the other hand, only 18% of people
on a credit card limit of less than $5,000 believe they would last
more than three months on their current savings.
No surprise that 47% of people who rarely save would last less
than a week, with 73% of these people lasting up to four weeks.
And people who are worried about their financial future may have
every reason to be as 37% of them would last less than a week
and 69% up to four weeks.
35%
Good/V.Good 12% 6% 11% 4% 7% 5%
2%
4%
35%
Good/V.Good 12% 6% 11% 4% 7% 5%
20% 2% 13% 4% 13%
Average
4% 5% 7% 2% 16%
Average
Poor/V.Poor
20%
Poor/V.Poor 0
Less than 10week
14%
14%
17%
2%
2% 17%
13% 4% 13% 5% 7% 2% 16%
40%
8% 8% 14% 6% 4%6%10%
2%
2%
2%
20
408% 8% 60
100
40%
14% 6% 80
4%6%10%
20
40
60
2%
80
100
2 weeks
3 weeks
4 weeks
5 to 6 weeks
7 to 8 weeks
9 to 10 weeks
11 to 12 weeks
More than 3 months
I honestly don’t know
Once again there are strong ties back to financial education.
Only 6% of Australians with a poor or very poor understanding
of personal finance would last more than three months on their
current savings whereas 35% of people with a good or very
good understanding would last this long. Similarly 40% of those
with the lowest levels of understanding would last less than one
week compared with 12% of people with a good or very good
understanding.
FIN-Q Survey 27
Agree or disagree?
Next in the Citi Fin-Q Survey, respondents were asked to agree
or disagree with numerous statements using a scale of one to
five. Note the terms ‘disagree subtotal’ and ‘agree subtotal’
consist of disagree/strongly disagree results added together
and agree/strongly agree responses added together.
Statement: Given the recent market
volatility and swings, I’m staying out
of the share market
This research was conducted in October 2007 when the share
market was showing signs of turbulence. It’s interesting to note
that a combined 61% disagreed with the statement compared
with an overall total of 39% who agreed that market volatility
was keeping them out of the share market.
Females showed their aversion to risk with men saying they were
more likely to continue investing in shares. The over 40s were
also more conservative in their approach as were those worried
about their financial future – almost half said they would stay out
of the share market for now.
Curiously, level of financial understanding didn’t produce differing
results. Both groups - those with a poor/very poor level of
understanding and those with a good/very good understanding
- had an average disagree subtotal of around 64%.
Comparisons
Age
18-29 10%
53%
24%
13%
18-29 10%
30-39 9%
53%
54%
24%
18%
13%
19%
30-39 9%
40+ 16%
54%
41%
40+ 0 16%
0
20
40
41%
20
40
18%
19%
19%
23%
60 19%
80 23% 100
60
80
17%
46%
20%
17%
17%
Good/V.Good
Average 7%
46%
50%
20%
22%
17%
20%
Average 7%
Poor/V.Poor 10%
50%
56%
22%
12%
20%
22%
Good/V.Good
Poor/V.Poor 010%
0
Strongly disagree
20
40
56%
60
20
40
60
12% 80 22% 100
80
Disagree
Agree
Strongly agree
28 FIN-Q Survey
100
100
Statement: Market movements have
not changed my investment behaviour
Comparisons
Overall quality of life
V. Satisfied 9%
30%
25%
V. Satisfied 9%
Satisfied 6%
30%
43%
25%
On a similar theme to the last statement, the results were
pretty much split evenly. Forty one percent disagreed with the
statement representing the highest single response, but when
added together – the 52% who agreed/strongly agreed means
that overall, those who have not changed their behaviour came
out slightly ahead.
Satisfied 6%
Not Satisfied 10%
The over 40s had a 58% agree subtotal whereas the 30-39 year
olds had a 55% disagree subtotal.
Not Satisfied 010%
There are also some interesting findings with respect to credit
card limits. Those with the higher limits of $10,000 and lower
card limits of less than $5,000 are neck and neck when it comes
to total agreement (59% and 57% respectively). However if the
strongly agree figures are isolated – the lower card limits are way
ahead with a 30% response compared to 16% - perhaps indicating
their defiance of the share market volatility.
Satisfaction with quality of life, confidence in retirement savings
and understanding of personal finance also go some way to
explaining the sentiment around this question. People not satisfied
with their overall quality of life are more likely to disagree with
the statement (54%) than people who are very satisfied (39%).
Looking at it another way, very satisfied people had a 61% agree
subtotal compared with 46% of those not satisfied.
People confident with the direction their retirement savings are
taking are also in agreement with the statement – in fact 29%
strongly agreed and 30% agreed. For people not confident the
corresponding figures are 27% and 19%. Finally, those with a
poor or very poor understanding of personal finance made their
thoughts very clear – a high 62% of these people said they
disagreed overall with the statement.
0
43%
44%
20
44% 40
20
40
36%
26%
36%
25%
26%
18%
25%
28%
60
18%
8028%
100
60
80
100
Good/V.Good 7%
35%
30%
Good/V.Good 7%
Average 6%
35%
43%
30%
23%
Average 6%
Poor/V.Poor 12%
Poor/V.Poor 0 12%
0
Strongly disagree
43%
28%
28%
27%
50%
23%
8%
27%
30%
20
40
50%
60 8%
8030%
100
20
40
60
80
100
Disagree
Agree
Strongly agree
FIN-Q Survey 29
Statement: You have to accept shortterm swings or volatility in the share
market.
The majority of respondents (64%) either agreed or strongly
agreed with the notion that you have to accept short-term swings
in the market. This was broken down into 38% who agreed and
26% who strongly agreed leaving a disagree subtotal of 36%.
Men had a 10% higher agree subtotal than women – 69% versus
59% and those aged over 40 had the highest strongly agree
response per age group at 30%.
Other findings of note:
• Those with an income of $50,000 or more had an agree
subtotal of 76% compared with 56% for people in the other
two income categories
• One of the highest strongly agree responses (34%) was by
people who had credit card limits of $10,000 or more – their
agree subtotal was 71%
• There was a 75% agree subtotal from people who don’t feel
secure in their job compared with 60% for people who do feel
secure in their current role
• Those with a good/very good understanding of personal
finance had an agree subtotal of 71% compared with 50% of
those with a poor/very poor understanding
• Rare savers ended up with a 43% disagree subtotal compared
with 27% of people who save money from every pay
Comparisons
Age
18-29 3%
34%
46%
17%
18-29 3%
30-39 5%
34%
29%
46%
39%
17%
27%
18-29 3%
30-39 5%
40+ 6%
34%
29%
31%
46%
39%
33%
17%
27%
30%
30-39 5%
40+ 06%
29%
20
31%
40
39%
33%60
27%
8030%
100
40+ 06%
20
31%
40
33%60
8030%
100
0
20
40
60
80
100
Low <$30K 7%
37%
33%
23%
Low <$30K 7%
Med $30-$50K 5%
37%
39%
33%
30%
23%
26%
37%
Low <$30K 7%
39%
Med $30-$50K 5%
High >$50K 4% 20%
33%
30%
23%
26%
28%
39%
Med $30-$50K 5%
High >$50K 04% 20%20
30%
40 48% 60
26%
8028%
100
High >$50K 04% 20%20
40 48% 60
8028%
100
80
100
48%
0
20
40
Understanding
of personal
finance
60
Good/V.Good 4%
25%
39%
32%
Good/V.Good 4%
Average 6%
25%
32%
39%
Good/V.Good 4%
Average 6%
Poor/V.Poor 4%
25%
32%
46%
39%
Average 6%
Poor/V.Poor 04%
32%
2046%
40
41%
6028%
21%
80 22% 100
04%
Strongly
disagree
Poor/V.Poor
Disagree
0
Agree
2046%
40
6028%
80 22% 100
20
40
60
80
41%
32%
21%
41%
28%
32%
21%
22%
Strongly agree
30 FIN-Q Survey
100
Statement: If I was given $1,000,
I would spend it not save it
One of the first points to note is that the people who should be
disagreeing with this statement – (i.e. save not spend) haven’t
necessarily done so. We found that many people who rarely save,
are worried about their financial security or don’t feel secure in
their job would spend $1,000, rather than save it.
For example, a combined 51% of Australians who rarely save
agreed with the statement compared with 18% of those who save
every pay. The equivalent figure for those worried about their
financial future was 37% and for those with a poor or very poor
financial understanding the figure was 44% - compared with 21%
of those with a good or very good understanding.
Transactors (those who pay off their credit card balance in full
each month) are very likely to strongly disagree (43%) compared
to people who carry a balance forward each month (26%). Their
respective disagree subtotals are 80% and 65%.
But it’s reassuring to see two thirds (67%) of 18-29 year olds
say they would save, not spend. This is not too far off the 70%
of 30-39 year olds and 74% of over 40s who would also opt to
save the money. And if you’re wondering which sex would be
the more responsible, more males disagree with the statement
(75%) indicating they would save not spend – that is 8% more
than women.
Comparisons
Saving patterns
44%
Save every
pay
Save every
pay
Save when
can
Save when
can
Rarely save
32%
19%
30%
Rarely save 0
19% 20
30%40
0
20
40
44%
32%
38%
12% 6%
38%
12% 6%
19% 7%
42%
42%
19% 7%
20%
31%
6031%
80 20% 100
60
80
100
Card payment pattern
Pay full
balance
Pay full
balance
Carry balance
each month
Carry balance
each month 0
43%
37%
16% 5%
43%
37%
16% 5%
26%
39%
26%
0
Strongly disagree
22%
13%
20
39%
40
60
22%
80
13%
100
20
40
60
80
100
Disagree
Agree
Strongly agree
FIN-Q Survey 31
Statement: When it comes to money
management and personal finance
matters, my parents taught me to be
financially responsible
The total figures were more or less evenly split with a combined
52% of respondents agreeing with the statement. This left 48%
who disagreed including 20% who strongly disagreed.
When drilling down further, there are some interesting comparisons.
Women are more likely to strongly disagree than men – 24%
compared with 16%.
Whether these people are looking for someone to blame, or their
parents really did let them down is not known. What we can say
is this statement raises the question of the role parents play in
financial education.
Positive patterns can be seen in the results. Thirty five percent
of people who pay their full credit card balance each month agree
with the statement and a further 27% strongly agree. This means
62% of people who are in the habit of paying off their balance
each month, could potentially attribute their behaviour to their
parents. The results for people who carry a balance however are
different – the majority don’t agree their parents were good role
models and nearly one in four (24%) strongly disagree.
Looking at the age breakdowns, the 18-29s are more supportive of
the statement overall with an agree subtotal of 63%. This figure
falls away to 50% for 30-39 year olds and 47% for over 40s. And
for the record, only 14% of 18-29s strongly disagreed with the
statement. Overall this means parents of 18-29 year olds are
generally getting the thumbs up for teaching their children to be
financially responsible.
Turning our attention towards those with and without kids, the
results are very interesting. Those with kids of their own are
much more likely to disagree with the statement, indicating their
parents didn’t teach them to be responsible with money. The
disagree subtotal for people with children was 52% and without
children was 40%.
On the other hand (and while skewed by the responses from
the 18-29 age group) a total of 60% of people without children
agreed their parents did teach them to be financially responsible
compared with 48% of those with kids.
Further results indicate that those who are not satisfied with their
overall quality of life, who are worried about their financial future,
rarely save and have a poor understanding of personal finance
are significantly more likely to disagree with the statement. The
graphs tell the full story.
32 FIN-Q Survey
“Further results indicate
that those who are not
satisfied with their overall
quality of life, who are
worried about their financial
future, rarely save and
have a poor understanding
of personal finance are
significantly more likely
to disagree with the
statement.”
V. Optimistic 11%
V. Optimistic 11%
18-29
14%
23%
40%
23%
18-29
30-39
18-29
14%
23%
14%
23%
23% 27%
40%
23%
19%
23%
30-39
40+
30-39
23%
21%
23%
27%
33%
27%
40+ 0 21%
21%
40+
0
0
40% 31%
31%
29%
31%
20
40
33%
60 29% 80
20
33%
40
60
80
100
20
40
60
80
100
18% 100
18%
V. Satisfied
16%
24%
28%
25%
V. Satisfied
V. Satisfied
Satisfied
16%
16%
16%
24%
29%
24%
28%
37%
28%
25%
18%
25%
Satisfied
Not Satisfied
Satisfied
16%
29%
16% 33%
29%
37%
24%
37%
23%
Not Satisfied 0
20
33%
40
23%
60 24%
Not Satisfied
23%
40
24%
0
33%
20
0
20
40
31%
38%
20%
31%
16%
25%
Optimistic
16%
25%
Worried
32%
Worried 0
32%
20
0
20
40%
20%
40%
30%
20%
23%
14%
40 30%
60
23%80
14% 100
40
60
80
100
Savings pattern
19%
18%
19%
29%
20%
Optimistic
Comparisons
Age
38%
32%
Save every 9%
pay
32%
Save every 9%
pay
20%
24%
Save when
can
20%
24%
Save when
can
34%
Rarely save
32%
27%
32%
27%
38%
19%
38%
19%
33%
20%
13%
Rarely save 0
34%
20
40
33% 60
20%
80
13%100
0
20
40
60
80
100
18%
20%
18%
Good/V.Good 12%
26%
34%
29%
Good/V.Good 12%
26%
34%
29%
Average
19%
32%
34%
15%
Average
19%
32%
34%
15%
80
20%100
Poor/V.Poor
60
80
20%
100
Poor/V.Poor 0
60
80
100
Financial future
0
Strongly disagree
48%
22%
20%
10%
20%
80
10%
100
2048%
40
22%
60
20
40
60
80
100
Disagree
V. Optimistic 11%
V. Optimistic 11%
16%
V. Optimistic
Optimistic 11%
16%
16%32%
Optimistic
Worried
Optimistic
Agree
38%
20%
31%
38%
25%
38%
20%
40%
20%
31%
20%
31%
25%
30%
25%
Worried 0
20
32%
40 30%
Worried
0
32%
20
0
20
40%
40% 23%
Strongly agree
20%
14%
20%
60
23%80
14% 100
60
23%
80
14%
40
40
60
80
30%
100
100
Save every 9%
pay
32%
32%
27%
Save every 9%
20%
Save every
when
pay 9%
Save
can
pay
32%
32%24%
32%
38%
32%
27%
19%
27%
20%
Save when
34%
Rarely
save
can
20%
Save when
can
20
34%
Rarely save 0
34%
Rarely save
0
20
0
24%
38%
33% 38%
24%
20
40
20%
19%
13%
19%
33% 60
80
20%
13%100
33%
13%
100
100
40
60
20%
80
40
60
80
Good/V.Good 12%
26%
34%
29%
Good/V.Good 12%
26%
34%
29%
FIN-Q Survey 33
Statement: I feel quite confident about
my country’s economic future
Men, 18-29 year olds and those with no kids are most confident
about Australia’s economic future – having higher agree subtotals
than other respondents. Women, the over 40s and parents are
the least confident.
Looking first at the gender difference, 17% of men strongly
agree with the statement compared with only 8% of women. For
women this lag has gone to the strongly disagree camp with a
15% result compared with 8% for men. All up, 57% of women
disagree compared with 45% of men.
Optimism shines through for 18-29 year olds. Their agree subtotal
was 61% compared with 43% for 30-39 year olds and 49% for
over 40s. The 30-39 year olds had the highest disagree subtotal
with 57%.
Level of income also sways the result. Those on a personal income
of less than $30,000 per year are more inclined to strongly
disagree (18%) with the statement than those on an income of
over $50,000 (7%).
Credit card limits also show differing results. Those with low credit
card limits are most likely to disagree with the statement – 55%
of people with a limit below $5,000 disagree or strongly disagree
compared with 41% of people with a limit of more than $10,000.
Those who are confident about their level of retirement savings
are also confident about Australia’s economic future. All up, the
total agree figure is 65% compared with 38% for people who are
not confident they are on track for retirement.
Comparisons
8%
37%
39%
17%
Gender
Male
Male
8%
37%
39%
17%
Male 8%
37%
39%
17%
Female 15%
Male 8%
Female 15%
0
Female 15%
Female
0
0
15%
0
37%
20
20
42%
42%
40
42%
39%
60
36%
36%
80
36%
8%
17%
8%
100
8%
40
42%
40
60
20
60
80
36%
80
100
8%
100
20
40
60
80
100
6%
33%
48%
13%
18-29 6%
33%
48%
13%
12%
30-39
18-29 6%
33% 45%
48% 33%
10%
13%
30-39 12%
18-29 6%
14%
40+ 12%
30-39
33%
45%
33%
48%
34%
33%
10%
13%
15%
10%
Age18-29
40+ 14%
30-39 0 12%
40+ 14%
0
20
40+ 0 14%
0
Have children
37%
45%
20
37%
45%40
37%
40
60 34%
80
33%
34%
60
80
15%100
10%
15%
100
20
40
37%
60 34% 80
15%100
20
40
60
80
Yes
13%
42%
33%
12%
Yes
13%
42%
33%
12%
Yes
13%
42%
33%
12%
No 8%
Yes 13%
No 8%
0
No 8%
35%
44%
33%
44%
6044%
80
13%
12%
13%
13%100
35%
20
35%
0
No 8%
0
20
35%
20
40
60
44%
60
80
40
80
100
13%
100
20
40
60
80
100
42%
40
Confidence in retirement savings
0
Confident 6%
29%
45%
20%
Confident 6%
29%
45%
20%
Confident 6%
29%
45%
20%
Not 15%
29%
Confident
confident 6%
Not 15%
confident 0
20
Not 15%
confident
0
20
Strongly
disagree
Not 15%
0
20
confident
Disagree
Agree
0
20
Strongly agree
47%
47%
40
47%
45%
60
31%
7%
20%
31%
7%
80
100
31%
7%
40
47%
40
60
60
80
31%
80
100
7%
100
40
60
80
100
34 FIN-Q Survey
100
37%
Male
Statement: I don’t feel very secure in
my current job
Summing up, three in four (75%) Australians feel secure in their
job – having said they either disagree or strongly disagree with
this statement. Half of women strongly disagree compared to
37% of men.
Looking at the age groups, 50% of over 40s strongly
disagree compared with 37% of 30-39 year olds and 43% of
18-29 year olds.
Those who earn more than $50,000 per year had a strongly
disagree result of 52% and a disagree subtotal of 82% suggesting
they’re feeling pretty secure in their jobs.
Finally, all the usual suspects are at play here; those who are very
satisfied with their overall quality of life strongly disagree with
the statement (66%) compared to people not satisfied (28%);
similarly, 64% of people who are very optimistic about their
financial future strongly disagree with the statement and 47% of
people who save money from every pay, strongly disagree with
the statement.
38%
16%
10%
13%
16%
12%
10%
Comparisons
50%
37%
Female
Male
Gender
0
20
26%
38%
40
60
37%
50%
Male
Female
0
20
38%
26%
40
50%
Female
V. Satisfied 0
20
40
66%
42%
13%
20
42%
40
28%
60
35%
0
Have
children
Not Satisfied
0
42%
20
8016% 7%
100
28%
35%
20
40
9% 8%
15%
35%
60
40
12%
9% 8%
22%
17%
35%
100
16% 7%
66%
Not Satisfied
10%
12%
100
17%80 9% 8%
17%
15%
35%
V. Satisfied
Satisfied
26%
35%
28%
Satisfied 0
16%
13%
80
66%
V. Satisfied
Not Satisfied
100
60
60
Satisfied
80
22%
16% 7%
80
100
15%
60
22%
80
100
Yes
47%
32%
12% 10%
No
Yes
37%
47%
32%
32%
19%
12%
12% 10%
0
20
40
47%
Yes
Strongly
Nodisagree 37%
Disagree
60
32%32%
80
12% 12%
10%
19%
Agree
0
20
40
60
80
Strongly agree
37%
32%
19%
No
0
20
40
60
100
80
100
12%
100
FIN-Q Survey 35
2%
Sources of information
on money matters?
52%
18-29
6% 16%
9% 4% 9%
1% 1%
27%
30-39
15%
15%
9% 11% 4% 17%
2%
14%
27%
9% 7% 5% 5%
0
20
Comparisons
52%
18-29
2%
40+
Friends and family are the main point of reference when looking
for information on money matters (29%). Next in line are finance
professionals such as accountants or financial planners at 18%.
The internet then follows at 13%. Given that many people don’t
think their parents did such a great job teaching them to be
financially responsible – this may be cause for concern, or explain
why 20% of people say they rely on themselves!
Getting more specific, there was only one real difference between
the sexes and that’s in relation to seeking professional advice.
Twenty one percent of women said they seek information from
accountants or financial planners compared to 15% of men.
Experience shows when looking at the age groups. The over 40s
are more likely to turn to finance professionals (27%) compared
with 30-39 year olds (15%) and 18-29 year olds (6%).
The 18-29 year olds prefer the wisdom of friends and family (52%)
much more than 30-39 year olds (27%) and over 40s (14%). The
over 40s make the most of their knowledge and experience with
31% relying on themselves for information.
The 30-39 year old age group also rely on newspapers/magazines/
books to a greater extent than other age groups at 11%.
One in four (25%) people with children rely on themselves for
financial information compared with 12% of those with no kids.
Next point of reference for parents are friends and family (23%)
followed by accountants or financial planners (22%). The circle of
reference follows a slightly different pattern for those with no kids.
First in line are friends and family (39%), followed by the internet
(21%) and thirdly, themselves on 12% as mentioned above.
Turning to some attitudinal aspects of the research, as with
other questions, this is another example where those who need
outside help the most aren’t seeking it – or aren’t getting it. For
example, one in three (33%) people who don’t save rely primarily
on themselves for financial information.
Twenty three percent of Australians worried about their financial
future also rely heavily on themselves for financial information
compared with 16% who are very optimistic. Finally – and
probably most cause for concern, 30% of Australians who have
a poor or very poor understanding of personal finance also rely
first and foremost on themselves for information in relation to
money matters. This is followed by friends and family (26%) and
the internet (18%).
People who are very optimistic about their financial future say
they rely evenly on friends/family and finance professionals (both
25%) while those who say they are just optimistic are most likely
to get their information from friends and family (31%).
To tie things off, a follow up question looked at the extent people
are happy to discuss their personal finances with their bank.
Thirty percent of people who rarely save said they would not
discuss their financial situation with their bank and the less the
bank knows about their finances the better. On the other hand,
those who have positive feelings towards their quality of life and
financial future are much more likely to seek help from a bank.
36 FIN-Q Survey
40
60
6% 16%
31%
2%
80
100
9% 4% 9%
1% 1%
Age
27%
30-39
15%
15%
9% 11% 4% 17%
2%
2%
6% 16% 9% 4% 9%
52%
18-29
14%
40+
27%
27%20
30-39 0
23%
14%
Yes
40+
0
No
Have children
31%
1% 1%
2%
15%40 15% 60
9% 11% 4%
80 17% 100
2%
22%
9% 9% 6%4%
25%
27%
9% 7% 5% 5%
31%
2%
2%
20
40
60
80
100
39%
10%
21%
6% 8%3% 12%
1% 1%
0
20
23%
Yes
9% 7% 5% 5%
40
22%
60
80
9% 9% 6%4%
100
25%
2%
23%39%
No
Yes
0
12%
6% 8%3%
22%10%9% 21%
9% 6%4%
25%
1%
1%
2%
20
40
60
10%
21%
No
Understanding
of39%
personal finance
80
100
6% 8%3% 12%
1% 1%
Good/V.Good0
27%20
40
20%
80
14%606% 9% 3%
18% 100
1% 2%
31%
Average
17%
11% 10% 7% 4%
19%
2%
26%
Poor/V.Poor
Good/V.Good
0
20
27%
8%
18%
40
20%
10% 6%
30%
2%
60
80
14% 6% 9% 3%
18%
100
1% 2%
Friends and family
31%
17%
11%
10% 7% 4% 19%
AnAverage
accountant/financial
planner/bank
official
2%
The internet
27%
20%
14% 6% 9% 3% 18%
Good/V.Good
Written materials from a bank/financial institution
2%
26%
8%
18% 10% 6% 1% 30%
Poor/V.Poor
Newspapers/magazines/books
2%
31%
17%
11% 60
10% 7% 4%
Television/radio
ads 20
or programs
Average 0
40
80 19% 100
2%
Community organisations
Other
26%
8%
18%
Poor/V.Poor
None of these, I only rely on myself
10% 6%
30%
2%
0
80
Note: Percentages
may 20
not add to 40
100% due 60
to rounding
100
“People who are very optimistic about their financial
future say they rely evenly on friends/family and finance
professionals (both 25%) while those who say they are
just optimistic are most likely to get their information
from friends and family (31%).”
FIN-Q Survey 37
Fin-Q scores
So what is the financial well-being of
Australians really like?
As we said at the beginning of this report, the Citi Fin-Q Survey was designed to measure the Financial Quotient (Fin-Q score) or financial
well-being of people. As part of this survey, Citi scored respondents on 11 different questions closely related to financial well-being with
a maximum possible score of 100.
How did Australians go?
The average Fin-Q score for Australia was 44.1 – not a high result. As you can see below, the areas in need of the most improvement are
having a formal financial plan, having an up-to-date will and building a retirement nest egg to enable a comfortable retirement.
Fin-Q subject area
Maximum achievable
Average Fin-Q score
Satisfaction with overall quality of life
10 points
4.8
Optimism about financial future
10 points
4.3
Current approach to budgeting
10 points
4.9
Current approach to savings
10 points
5.3
Credit card payment patterns
10 points
6.2
Home ownership status
10 points
3.8
Insurance status
10 points
4.3
Retirement savings status
10 points
3.1
Knowledge of investing
10 points
5.2
Have a formal financial plan
5 points
0.8
Have an up-to-date will
5 points
1.4
100 points
44.1
Looking at the scores in more detail, only 29% of women had a Fin-Q score above 50 compared with 40% of men. At the same time,
one in three women (37%) registered a score of 0-30 out of a possible 100 - a very poor result.
Fifty percent of over 40s achieved a score above 50 compared with 23% of 18-29 year olds and 27% of 30-39 year olds.
Looking at annual personal incomes, 44% of people on an income of less than $30,000 had a score of 0-30 compared with 19% of
people on an income of $50,000 or more.
Was having children a factor in the score? Not to a great extent – 36% of those with children had a score above 50 compared with 30%
of people with no kids.
As you’d expect people not satisfied with their overall quality of life had mainly low scores – 70% scored between 0-30. People worried
about their financial futures also had low scores – 68% between 0-30 and 69% of undisciplined savers achieved a score between the
same range.
It was the other extreme for the very satisfied, very optimistic and regular saver. In fact 76% of people who are very optimistic about
their financial future registered a score above 50.
Finally, 54% of those who pay their full credit card balance each month scored above 50 compared to 20% of people who carry a
balance each month.
38 FIN-Q Survey
Conclusion
That’s it - a summary of the Australian findings from the Citi Fin-Q Survey.
Due to our global reach and information edge, Citi is very fortunate to be able
to undertake research across different countries and regions like this and as
we indicated earlier, our next step is to produce a comparative report so we
can see how Australia fared against countries in the Asia Pacific region.
In the meantime, perhaps you’d like to put yourself to the test and calculate
your own Fin-Q score. It’s easy and there are two ways to do it. You can
use the Citi Fin-Q calculator online at www.citibank.com.au or answer the
questions on the next page and tally up your score.
Don’t despair if your score is on the low side – there are positive steps you
can take to improve your financial well-being by speaking to your bank, going
to see a financial planner or a financial counsellor to name a few.
FIN-Q Survey 39
Take the Citi Fin-Q
score challenge
Simply answer the eleven questions below and tally up your score.
1.
2
3.
4.
5.
6.
7.
Thinking about your overall quality of life, which one of the following statements best describes how
satisfied you are with your current quality of life?
I am very satisfied with my current quality of life
1
(10 points)
I am satisfied with my current quality of life
2
(5 points)
I am not satisfied with my current quality of life
3
(0 points)
I am very optimistic about my financial future
1
(10 points)
I am optimistic about my financial future
2
(5 points)
I am worried about my financial future
3
(0 points)
Thinking about your financial future, which one of the following statements best describes how
optimistic you are about your financial future?
Thinking about budgeting, which one of the following statements best describes your current approach to budgeting?
You make a monthly budget and stick to it
1
(10 points)
You make a budget but do not always stick to it
2
(5 points)
You do not budget because you are not that organized
3
(0 points)
Thinking about savings, which one of the following statements best describes your current approach to savings?
You set aside / save some money every time you get paid
1
(10 points)
You set aside / save some money when you can
2
(5 points)
You rarely set aside or save money when you get paid
3
(0 points)
Thinking about credit cards, which one of the following usually applies when you receive your credit card statement?
You pay off the full outstanding balance
1
(10 points)
You pay off more than the minimum payment and carry a balance into the next month
2
(5 points)
You make the minimum payment and carry a balance into the next month
3
(0 points)
Thinking now about home ownership, which one of the following statements bests describes your current situation?
You currently own your own home or apartment outright
1
(10 points)
You are currently paying a mortgage / home loan on your own home or apartment
2
(5 points)
You do not own your own home or apartment but are currently living rent or mortgage free
3
(5 points)
You are currently living with your parents and paying rent/board
4
(0 points)
You are currently renting
5
(0 points)
You know you have enough insurance to ensure that if you were to pass away, become sick or disabled
you and your family would not suffer financially
1
(10 points)
You currently have life insurance but no other type of insurance (eg health or critical illness insurance)
2
(5 points)
You do not currently have any insurance
3
(0 points)
Thinking now about life insurance and speaking hypothetically of course, which one of the following
statements best describes your current status?
40 FIN-Q Survey
8.
9.
10.
11.
Thinking now about your retirement savings, which one of the following statements best describes
your current status?
You know how much saving and investments you need to fund a comfortable retirement and are
confident you are on track
1
(10 points)
You have some savings and investments but don’t know it’s enough to fund a comfortable retirement
2
(5 points)
You don’t know how much savings and investments you’ll need to fund a comfortable retirement
3
(0 points)
You have not started planning for your retirement
4
(0 points)
If you were given an amount equal to six month’s salary to invest, you would know exactly what
to do with it
1
(10 points)
If you were given an amount equal to six month’s salary to invest, you would have a good idea what
to do with it
2
(5 points)
If you were given an amount equal to six month’s salary to invest, you would have no idea what
to do with it
3
(0 points)
Thinking now about investing, which one of the following statements best describes your current
level of knowledge about investing?
Do you currently have a formal retirement plan that was developed in consultation with a financial
professional like an accountant, financial planner, investment advisor, banking or insurance professional?
Yes
1
(5 points)
No
2
(0 points)
Do you currently have an up-to-date will that was developed in consultation with a legal professional like a lawyer?
Yes
1
(5 points)
No
2
(0 points)
MY TOTAL FIN-Q SCORE IS
How did you go?
0-25
More room for improvement! Start by giving your financial well-being the priority it deserves. Look at some of the basics
first - keep a record of how much you spend each week, prepare a budget aimed at saving money or paying off that credit
card bill. Come up with a few financial goals that are realistic and achievable for you...consider seeking help from an expert
to do this.
26-50
Keeping in mind the total average score for Australia was 44.1, you’re not doing too bad, but there’s more progress to be
made! Yes, you may have some of the basics covered like a budget and regular savings which is a great start, but what about
other considerations like adequate insurance, a will and possibly starting to think about your long term financial future. You
might want to think about and prioritise these areas in the near future.
51-75
Congratulations, you’re obviously doing some of the right things and on your way to financial well-being. Now ask yourself
this. Do you have a formal financial plan? Do you have a retirement plan? At this stage, and if you haven’t done so already,
seeking professional advice could be a good step to get you to the next level.
76-100 Great result - looks like you’ve been on the front foot with your financial situation. Hopefully this has led to financial wellbeing and confidence in the future. As with any plan, it’s important to review it regularly to make sure it continues to meet
your needs, taking into account the changing financial environment.
The Citi Fin-Q Calculator is a tool to assess your awareness on financial planning. It is for general information and education purpose only. The Citi Fin-Q
Calculator is not a financial tool and is not intended as a recommendation or an offer or solicitation for the purchase and sale of any investment products.
Any person considering an investment should seek independent advice on the suitability.
FIN-Q Survey 41
Notes
42 FIN-Q Survey
This material is published by Citigroup Pty Limited ABN 88 004 325 080 AFSL No. 238098. © 2008 Citigroup Pty Limited. Citigroup, Citibank and Arc Design are registered
trademarks of Citigroup Inc. and are used and registered throughout the world. Any advice provided is general advice only and does not take into account your personal
circumstances. We recommend you seek professional advice on your personal circumstances before acting no the information contained in this material.

Results and insights from the Citi Fin

Transcription

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