The extraordinary number of Aussies with less than $1,000 in the bank – with more boomers than millennials in trouble

Baby boomers are more likely than millennials to have less than $1,000 in savings as the cost of living crisis hits older generations, new figures show.

Australian consumers in their 60s and 70s are often accused of perpetuating the inflation crisis, based on the theory that people who own their own homes without a mortgage have more money to spend.

But baby boomers, who are more likely to qualify for state pension age at age 67, are also more likely to be retired and therefore do not have enough income from wages to pay for unexpected expenses in life, such as medical bills.

New data from financial comparison group InfoChoice shows that 15.1 percent of people born between 1946 and 1964 were in this dire situation if they had less than $1,000 in the bank or stashed away somewhere.

By comparison, 14.7 percent of millennials born between 1981 and 1996 were strapped for cash.

Generation Z adults, born after 1997, are less likely to pay off a mortgage, but have the least savings because they are more likely to rent or pay off student loans.

One in five, or 19.1 percent, had less than $1,000 in the bank. This group reported spending more money on tattoos, lip fillers and Botox.

That’s only slightly higher than the 17 percent figure for Generation X Australians, those born between 1965 and 1980, who are more likely to be busy paying off a mortgage and raising teenage children.

The idea that baby boomers are fuelling Australia’s inflation crisis is true, as the survey found that one in three (29.2 per cent) had more than $100,000 in savings to pass the time on restaurant meals, new cars and cruises.

According to Harrison Astbury, financial analyst at InfoChoice, baby boomers have surprisingly been less conservative with money and many of them have fallen victim to not planning their finances properly.

“The younger generation can be quite conservative in their approach to saving and wealth accumulation,” he said.

“In contrast, baby boomers are in a league of their own: nearly a third of them have more than $100,000 in savings, but a significant portion — more than average — don’t budget at all.”

By comparison, only 16.8 percent of millennials had more than $100,000 saved.

Only 6.9 percent of Generation Z found themselves in this happy situation, compared to 19.3 percent of Generation X.

Astbury says Australians of all ages are turning to alcohol and drugs to cope with tough economic conditions.

“Higher income earners are more likely to use drugs and engage in adult entertainment, while lower income respondents tend to spend more money on smoking and drinking. This suggests that a disproportionately large share of low income earners are being affected by the government’s ‘sin tax,'” he said.

‘It has been a challenging time to manage living expenses, save money and still make room for life’s finer things – no matter what generation you are, whether you have a mortgage or are renting.’

Generation Z adults, born after 1997, are less likely to pay off a mortgage but have the least savings because they are more likely to rent or pay off student loans (pictured are youth in Brisbane)

The majority of respondents admitted to drinking a lot of alcohol and eating fatty foods.

“When it comes to discretionary spending – life’s guilty pleasures – more than half of respondents admit to spending money on vices such as alcohol, fast food and gambling,” Astbury said. “I call the other 45 percent liars.”

More than 40 percent of Australians did not invest money in growth-oriented assets outside of property and superannuation, but in things like shares, bonds, financial derivatives, cryptocurrencies or exchange-traded funds.

The younger Generation Z was even more risk averse, with half of them choosing to keep their savings, in addition to their home and pension, in cash.

In June, the InfoChoice survey was conducted among 1,000 respondents, which sought opinions on how savings are stored, from bank deposits to cash.