Today, I want you to meet Hilda……
…..and talk about living comfortably in Australia. But what is comfort?
As you know, we like a good survey here at BobinOz. Sometimes we even like bad surveys, like the one that said Adelaide was the best city in Australia. But what has that got to do with Hilda?
Hilda is the Household, Income and Labour Dynamics in Australia. They conduct a survey each year and have been doing so since 2001. According to their website, these are the four main areas of Hilda….
- Households and family life;
- Incomes and economic wellbeing;
- Labour market outcomes; and
- Life satisfaction, health and wellbeing.
They gather information from over 7,000 households and almost 20,000 individuals to create a report. This year’s report is huge, 193 pages in all. It covers too many subjects to get through here, but some subjects covered according to the index that caught my interest were….
- Childcare issues.
- Wages and wage changes.
- Hours worked.
- Job and life satisfaction.
- Social exclusions.
- Job related discrimination.
But the area I am going to discuss here is “individuals perceptions of their financial wellbeing”. People were asked:
Given your current needs and financial responsibilities, would you say that you and your family are…
2. Very comfortable
4. Just getting along
6. Very poor
The results of that particular survey have not changed too much between 2001 and 2008, the years covered by this report. Here are the results for 2008:
1.7% described themselves as prosperous and 14.6% as very comfortable. The majority of Australians, that’s 53.1%, describe themselves as reasonably comfortable. But those who describe themselves as just getting along accounted for 27.1% making it the second most popular answer.
The good news is that those saying they were poor (2.9%) and very poor (0.6%) amounted to only 3 1/2 percent in total. On a satisfaction scale of nought (totally dissatisfied) to 10 (totally satisfied) 28.7% went for five or below and 71.3% said six or above. Seven was the most popular answer with 21.3 percent.
There! That’s how happy (or not) we are here financially in Australia.
But what does it all mean?
Well, Hilda has put a number on it. It would probably take too long for me to work out how they got there and way too long to put it into words here. So I will just blurt it out.
For a couple with one child, the magic figure for which they are more likely to be satisfied with their income than not is……..
I poured through the report to try and find out if this figure was before or after tax deductions. I found this:
Household disposable income.
The main household income measure examined in this report is ‘real household annual disposable income’. Household annual disposable income is the combined income of all household members, after receipt of government pensions and benefits and deduction of taxes, in the financial year ended 30 June…..”
So, after tax then!
What do I make of it all?
Firstly, it has to be noted that although the report has only just been released, the figures are talking about 2008. So it is already three years out of date. Secondly, statistics can be proved to show anything and I have said that many times elsewhere on this blog. It is hard to make out what this statistic actually proves.
In last month’s federal budget, the Chancellor froze some tax benefits to families with incomes above $150,000 a year, suggesting they did not need the money. So the message seems to be if you are taking home around $80,000 a year, you will probably be okay. If you are earning closer to $150,000 a year, you’re probably doing pretty good.
As you know, my family is as described above; we are a couple with one child. Personally, I would say to describe ourselves as “comfortable”, our joint incomes would need to be around $100,000 a year before tax deductions.
So I am inclined to agree with the figure quoted and it’s not far away from the one I use on my page about a comfortable family income. But bear in mind that the size of your monthly mortgage or rental bill on its own could easily make the difference between comfortable and just getting along.
Reading the comments from the article when it first appeared in the Courier Mail adds further enlightenment, or maybe not. There weren’t many when I last looked, just 19. I went through them all to see what the general opinion was about how much it really costs to live here comfortably.
Six people seem to think it would be really difficult to survive on $78,243 a year and another six thought it would be easy. The remaining seven commented on other matters. So word from the street is divided.
How much you will need to survive and live “comfortably” here in Australia is very much a subjective question. What is comfortable is subjective. But hopefully there are a few more pointers here to help you find the answer that is good for you. Either way, I would highly recommend you download your free report from Hilda, it has got lots of interesting stuff in it.
You can get it here.