Home ownership is slipping down Australians’ list of financial priorities as people opt for paying for their dream lifestyle over their dream home.
More than half of Australians (55 per cent) are listing financial independence as their number one priority, according to Insignia Financial’s Financial Freedom Report.
Financial freedom is defined as having enough passive income (either from a business, investments or savings) to cover your daily expenses and give you “the freedom to achieve your ideal life and no longer need to work as an employee”, according to University of Canberra’s Gianna Thomson.
The dream of home ownership has slipped from many Australians’ wish list. Picture: NewsWire/ Monique HarmerHolidays and other experiences are replacing spending money on home ownership. Picture NCA Newswire / Gaye Gerard
Australians have also reaffirmed their desires to travel after being cooped up during the pandemic with half of those surveyed saying they prioritise taking regular holidays.
Owning a home is now on par with having a good work/life balance in terms of priorities with 45 per cent of respondents saying it was their top aspiration.
According to Insignia financial chief executive Renato Mota, the shift in priorities has occurred at a time when the impacts of Covid-19 and increased cost of living pressures have changed people’s short term behaviours.
“It’s clear Australians have changed their priorities in life from the traditional dream of owning a home to living their dream lifestyle, which, is under pressure from the current economic climate,” he said.
“Australians are deeply aware of their financial wellbeing because it ultimately enables them to achieve the things that matter most to them, whether that be travel or spending time with loved ones.”
Mr Mota has urged Australians to educate themselves in order to take charge of their finances.
Shockingly, the top aspiration is quite different across different age brackets, with each generation having different desires.
Facing record high house prices, 63 per cent of Gen Z (aged 13-27) list owning their own home as their top financial priority.
More than half (54 per cent) of Generation Y (aged 28-42) say their biggest aspiration is to have a good work/life balance.
Meanwhile older Australians from Gen X (aged 43-57) and Boomers (aged 58-76) are more likely to be striving for financial independence over owning a home and having a balanced life.
And for those in their twilight years, more than half say taking regular holidays is the most important thing for them.
Only 22 per cent of Australians are completely happy with their financial situation. Picture: NCA NewsWire / Nicholas Eagar
As the cost of living crisis eats into Australians pay packets, there’s more of an appetite for improved financial literacy.
One in five (22 per cent) say that they are not satisfied at all with their financial situation and more than half (55 per cent) are only somewhat/slightly satisfied with the state of their finances.
To remedy this, 58 per cent want to manage their money better and 63 per cent are dedicating more time and energy to increasing their financial knowledge compared to a year ago.