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Australian home owners are struggling to meet mortgage repayments as household bills shoot up at more than double the rate of inflation.
According to ING DIRECT’s latest Financial Wellbeing Index, household bills have risen by 7.5 per cent over the last 12 months – more than double the official rate of inflation.
The greatest price hikes have occurred in essential goods and services - health, schooling, utilities and transport/fuel.
As a result, median savings per household have declined from $9,238 in the fourth quarter of 2010 to $7,215 in the first quarter of 2011.
In addition, 33 per cent of households are “uncomfortable” with their level of personal savings. More than one in four households is “uncomfortable" with their investments and 48 per cent have no investments outside the family home.
ING DIRECT chief executive officer Don Koch said governments need to realise households are under more pressure than official figures are showing.
“That pressure extends across the entire household budget from consistent costs like mortgage repayments to everyday essentials like food and fuel,” he said.
“While household budgets are under pressure, the good news is that job security and unemployment levels are strong which may help in the long term.”