A new report on how Australians are faring with money has found people regional areas in far more financial distress and have far lower levels of financial literacy raising concerns about regional areas being left behind.  

The report, “Mind the Gap: The Divide in Financial Wellness Across Australia”, found there’s a city and country divide with a significant disparity in income levels, education and financial wellbeing.  

The research found nearly half of regional Australians report high or overwhelming financial stress and 34% often cannot afford to dine out or go to movies. 

The average wellness score of 6.0 in major cities compared to 5.3 in regional areas suggests that city dwellers generally experience a higher level of financial security and stability. 

Analytics and technology company Your Financial Wellness commissioned the analysis using its own research and Census data 

Financial stress is widespread in Australia in 2023.

The average wellness score was 5.7, indicating a significant decrease in overall well-being in Australia according to the Mind the Gap report. 

Unsurprisingly, it attributed the decline “to the current economic climate characterised by rising inflation and uncertainty about the future.

"The data reveals that while 16% of respondents reported being fully satisfied with their finances, only 10% reported no financial stress at all. This gap likely reflects the phenomenon of "lifestyle creep", which is the tendency for people to constantly raise their standards and expectations as they achieve success and accumulate wealth.” 

Concerns about financial well-being and financial stress were significantly higher in regional areas. 

Image: Australian Government.  

CEO Alex Hassall said the research found nearly half of regional Australians are experiencing high or overwhelming financial stress.  

“Our research shows a stark divide between city dwellers and Australians in regional and rural areas, “ he said “We know that the higher the levels of financial literacy in regional centres, the greater financial wellbeing". 

Financial Wellness believes the problem is also in a lack of financial literacy.  Research has found those with higher levels of financial literacy are more likely to spend less income, create an emergency fund, and have more savings.   

“We know that the higher the levels of financial literacy in regional centres, the greater financial wellbeing,” Hassall said. 

The report recommended a government-led financial literacy campaign run along with financial institutions like banks, which the report said “have existing relationships with their customers and access to extensive resources, making them well-suited to promote financial capability to most Australians. 

“Many governments have made attempts to address this with limited success. We believe it's time for a financial literacy reboot in Australia” it said “Those with better financial capability are more engaged and successful. Informed people make better choices, improve their financial wellness, and reduce the burden on government and taxpayers.”