Cost of living puts Aussies off having kids


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Where to earn 5% on savings, one in five Aussies shelve having kids, and a national icon called out as a costly gas guzzler. Here are five things you may have missed this week.

Deposit rates hit 5% mark

Happy days for savers with Mozo's latest banking report showing at-call deposit rates have hit 5%.

having kids too expensive for young aussies

While most of the best rates still start with a '4', it's possible to ratchet up the return on cash to 5.0% with the likes of ING and Rabobank.

If you're aged between 14 and 35, Bank of Queensland has a sweet 5.15% deal.

The Australian Bureau of Statistics says Australians currently have a record $623.3 billion invested in deposit accounts, leaving many of us well-placed to chase a higher rate.

Having children too expensive for Aussies

Our cost of living crisis could morph into a population crisis.

A Compare the Market survey reveals almost one in five Aussies won't have children or will delay starting a family due to rising living costs.

Compare the Market's Stephen Zeller, says, "There could be a multitude of reasons why people are deciding not to have kids - but money tends to be a denominating factor."

He adds, "It's an expensive time to be alive, let alone take care of another person financially".

However, a reluctance to have children may not just reflect cost of living pressures.

Choosi's 2023 Cost of Kids Report shows that couples planning to have children feel they should have an average of $32,910 in savings before starting a family.

Only one in two (53%) of these couples said they are willing to sacrifice their current lifestyle to afford raising a child.

Utes come under fire as gas guzzlers

Five of the nation's top 10 selling cars are big utes. Yet a report by the Climate Council of Australia says they are "among the worst performing, and most polluting", vehicles on our roads.

Based on industry data, the study found the Nissan Navara is the most efficient of Australia's top-selling utes, with an average fuel bill and tailpipe emissions approximately 35% lower than the highest polluting and most expensive-to-run ute in the ten best-sellers, the Toyota Landcruiser.

The Climate Council notes that if, in the next five years, everyone in the market for a ute bought the most efficient 2022 model, this would cut their collective fuel bills by $210 million over that period and avoid 436,600 tonnes of CO2 emissions being pumped into the atmosphere.

The report follows a recent review by The Australia Institute, which found favourable tax treatment, such as temporary full expensing, is helping to drive Australia's love affair with utes.

Oxfam calls for super rich to slugged with higher taxes

Elon Musk, one of the world's richest men, paid a 'true tax rate' of just over 3% from 2014 to 2018. Aber Christine, who sells rice and flour in Northern Uganda, makes $80 a month in profit, and pays 40% tax.

That's just one of the startling snippets from Oxfam's latest Survival of the Richest report, which highlights how the world's uber wealthy have made huge gains during the COVID pandemic.

Since 2020, the wealth of global billionaires has skyrocketed by $US2.7 billion ($3.9 billion) per day, with the richest 1% of people gaining 63% of the new wealth created between 2020 and 2021.

In a push for income equality, Oxfam suggests billionaire-busting strategies such as imposing a 75% tax rate on the top 1% of income earners.

It's a long shot that this will happen here in Australia.

The top marginal tax rate is currently 45% for those earning over $180,000.

From July 1 next year, stage 3 tax cuts are scheduled to kick in, which will see those earning between $45,000 and $200,000 pay the same 30% marginal tax rate, with the highest 45% tax rate applied to incomes over $200,000.

Renting more affordable than buying in 90% of Australian suburbs

Just 12 months ago, it was cheaper to buy than rent in one in three suburbs across Australia. Not anymore.

CoreLogic says that despite a double-digit surge in rents, rapidly rising interest rates have made it cheaper to buy than to rent in less than one in ten suburbs nationally.

In Sydney, Melbourne and Canberra there are no suburbs where it's cheaper to buy than rent.

CoreLogic research director Tim Lawless says, "There is no doubt the cost to service a mortgage compared to rent is keeping people in rental accommodation, adding to the extreme pressure on rental demand at a time when supply levels have not responded.

"While many tenants might see home ownership as a way of breaking out of the rent cycle, it's just not possible for many because the cost to service a mortgage has become even more onerous in the past year with the increase in repayments outstripping the increase in rents by some margin."

There is still a reasonable choice of neighbourhoods where it is cheaper to buy than rent in Darwin, regional Western Australia, and to a lesser extent, regional Queensland and South Australia.

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A former Chartered Accountant, Nicola Field has been a regular contributor to Money for 20 years, and writes on personal finance issues for some of Australia's largest financial institutions. She is the author of Investing in Your Child's Future and Baby or Bust, and has collaborated with Paul Clitheroe on a variety of projects including radio scripts, newspaper columns, and several books.