Sydney, Australia – December 2024 – Much is said about the cost of living crisis impacting liquidity and purchase power. Now, new data released today from Equifax shows the emotional toll it’s taking, with 39% of Australians reporting increased stress about their financial situation in the past 12 months.
While 60% of respondents still defined themselves as financially ambitious in 2024 – a drop from 69% in 2022 – there was a shift in focus, with half (49%) of respondents saying that paying down debt or moving beyond living paycheck to paycheck is their biggest financial priority for the coming year.
The Equifax 2024 Australian Credit Scorecard offers market-leading insights into Australians’ credit habits, behaviours and attitudes towards financial matters. It combines Equifax analysis on the credit scores of the Australian banking population with consumer research undertaken across 1,015 Australians.
“Last year, our Australian Scorecard data showed consumers looking for budgeting techniques and rethinking their discretionary spending as they prepared to face economic headwinds. With the prolonged cost of living and inflationary pressures, many Aussies are still fighting to stay afloat,” said Melanie Cochrane, Equifax A/NZ CEO and Group Managing Director.
“While it’s encouraging to see consumers keeping their eyes on the prize in terms of financial ambitions, a concerning 30% are struggling with the cost of living to the point where they have no spare money to invest in their financial goals.”
The Equifax Australian Scorecard reveals that achieving personal financial goals is now far less related to making major purchases (2%) and more to living within means and sticking to a budget (36%), trying to save a particular amount every month (26%) or paying bills on time to avoid penalties (19%).
Half (50%) of respondents said they are less likely to be spending on discretionary purchases now compared to 12 months ago - a significant increase from 2022, when only 37% said this. As a practical response to building financial pressures, over half (56%) of Australians said they were cooking at home more to save money on eating out.
Not all Australians are impacted the same. Women are more likely to report feeling a heightened sense of financial stress (41% vs 36% men), while the same is true for Millennials (42%) and Gen Z (52%) when compared to those in older generations.
“Despite the cost of living crunch, the focus on staying on top of debt is good news and shows an important shift in terms of financial management,” said Cochrane. “But we’re not out of the woods, and in these moments the greatest pressure is inevitably felt by the most financially vulnerable among us - like young people, new migrants, those who have been through major life changes, and small business owners. It’s important to ensure that these groups aren’t financially excluded as the economy begins to improve.”
Insights from the Equifax Australian Scorecard 2024 also include:
- 45% of respondents said they were more likely to be saving money each month than they were 12 months ago, vs 48% in 2022.
- 55% of respondents said they were more likely to stick to a budget compared to 12 months ago, a slight increase from 51% in 2022.
- 32% of respondents said they use short-term credit like credit cards or BNPL to purchase everyday essentials, up from 23% in 2022.
Credit Score Improvement
Knowledge of credit scores is prevalent among Australians, with 93% of respondents aware that a record of their credit history is kept. However, there is some misinformation about the type of behaviour and information considered for the scoring. A quarter of Australians (24%) are not aware that “shopping around” for credit may impact their score, while 87% believe that unpaid fines like speeding tickets will show up on their credit report.
Still, with tighter household budgets and focusing on paying down debt as a priority for most, Equifax notes a collective improvement of credit scores over the past 12 months and a greater understanding of credit scores. From 2022 to 2024, the number of Australians who know how to access their credit report has lifted from 50% to 58%.
The national average credit score remained “excellent” at 861, lifting by six points from last year’s average result of 855. This year, approximately 9% of the population moved into a higher score band.
Other Equifax Australian Scorecard 2024 data shows:
- Residents in the Australian Capital Territory (with an average score of 906), followed by Tasmania (886) and Victoria (885), have the highest average credit scores.
- Northern Territory (834) and Queensland (857) residents’ average credit scores were the lowest.
- Women (896) on average have a higher score than men (882). The biggest credit score difference between men and women is observed in the 31-40 age bracket.
According to Carrie Cheung, Head of Insights at Equifax A/NZ, “Recently, we’ve seen that the growth in demand for personal loans and credit cards observed over the past two years has begun to wind down. Additionally, arrears across all product types have started to decrease, even though inflation and cost of living have remained challenging issues for many consumers. This tells us that people are maintaining payments and many households are becoming increasingly cautious with their spending, prioritising essentials and looking for ways to save wherever they can.
“This aligns with the research, with many Australians agreeing that their focus has shifted to managing debt, budgeting and staying financially afloat. Whether they realise it or not, actions like paying bills on time and limiting the number of short-term loans are helping boost Australians’ credit scores. This is good news, as a healthy credit score is an important tool for building long-term financial wellbeing.”
ABOUT EQUIFAX CREDIT SCORES
An Equifax credit score will fall into one of five bands, each representing a consumer’s level of risk according to their Equifax score. The score bands are:
- Excellent (853 – 1,200)
- Very good (735 – 852)
- Good (661 – 734)
- Average (460 – 660)
- Below Average (0 - 459)
An Equifax credit score is a summary of an individual’s credit information held by Equifax and indicates how credit providers may view consumers when they apply for credit. Equifax credit scores may be used by consumers to help them negotiate when applying for credit.
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FOR MORE INFORMATION
mediaenquiriesAU@equifax.com
ABOUT EQUIFAX INC.
At Equifax (NYSE: EFX), we believe knowledge drives progress. As a global data, analytics, and technology company, we play an essential role in the global economy by helping financial institutions, companies, employers, and government agencies make critical decisions with greater confidence. Our unique blend of differentiated data, analytics, and cloud technology drives insights to power decisions to move people forward. Headquartered in Atlanta and supported by nearly 15,000 employees worldwide, Equifax operates or has investments in 24 countries in North America, Central and South America, Europe, and the Asia Pacific region. For more information, visit www.equifax.com.au or follow the company’s news on LinkedIn.
ABOUT EQUIFAX CREDIT SCORECARD 2024
The Equifax Credit Scorecard offers market-leading insights into the credit habits and Equifax credit scores of Australian consumers, based on an analysis of the credit scores of the Australian banking population and consumer research. This research was undertaken by Qualtrics on behalf of Equifax. Total sample size was 1,015 Australian 18+ adults. Fieldwork was undertaken in September 2024. The survey was carried out online. The figures have been weighted and are representative of all Australian adults (aged 18+).
HOW TO ACCESS YOUR FREE EQUIFAX CREDIT REPORT AND EQUIFAX CREDIT SCORE
Consumers can access their free credit report from Equifax at equifax.com.au.
DISCLAIMER
Purpose of Equifax media releases:
The information in this release does not constitute legal, accounting or other professional financial advice. The information may change, and Equifax does not guarantee its currency or accuracy. To the extent permitted by law, Equifax specifically excludes all liability or responsibility for any loss or damage arising out of reliance on information in this release and the data in this report, including any consequential or indirect loss, loss of profit, loss of revenue or loss of business opportunity.
