Baby boomers and older Australians less likely to be impacted by cost-of-living crisis

ABC NEWS (Australia)

The housing crisis and stubborn inflation fight isn't hitting all households equally. A generational split is starting to emerge, with baby boomers and older Australians less likely to be impacted by the cost-of-living crisis

Transcript

00:00In Victoria's high country, baby boomers like Murray and his wife are enjoying their ski holiday.

00:09What they can't escape is a growing generational gap in spending.

00:14The older people have the money to spend and the younger people are finding it a bit tough.

00:19Boomers born between 1946 and 1964 are more likely to have paid off their housing,

00:26putting them in a good financial position, while inflation, rising rents and interest rate fuelled mortgage repayments

00:33have put younger generations under considerable pressure.

00:37The numbers that they've got now compared to when we had our mortgages, it's just astronomical.

00:42Ski store owner Paddy Hoy sees the gap when the time comes to settle the bill.

00:48We have grandparents coming and they're throwing their credit cards across our counter,

00:53whereas in the past it was generally more spread out throughout the family.

00:57Data from the anonymised accounts of 7 million Commonwealth Bank customers

01:02reveal the spending of people aged below 59 has either fallen or risen by less than inflation.

01:09But those aged 60 or above are splashing out, more than what prices have increased by.

01:16You can't blame the boomers, as so many people like to do,

01:20for perhaps demand running a little bit hotter than the Reserve Bank would like.

01:25That's because younger generations spend more overall, as they buy houses and raise children.

01:31It's just tough to be young and it always has been.

01:35For people with assets, superannuation and bank deposits, rising interest rates have sent more money their way.

01:42Are you saying you cause inflation?

01:44Well, spending money, yeah.

01:46We know that monetary policy is a blunt instrument and the impact is being felt unevenly across society.

01:53But with higher interest rates seemingly here to stay, that disparity is only going to get wider.

01:59A growing divide across generations.

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