• New research from the Commonwealth Bank looking at the attitudes Australian Millennials have towards their personal finances exposes a stark divide between expectations and reality.
• It found most say they lack a plan for saving long-term, with a third admitting to saving only occasionally.
• While 58% of millennials said they hoped to own property within the next five years, only a third have done so thus far.
• Visit Business Insider Australia’s homepage for more stories.

Australian millennials don’t have savings plans — while almost a third of them say they fail to regularly save, most are still optimistic they’ll be able to buy property in the next five years.

That’s despite soaring property prices across the country, with Sydney prices tipped to rise by more than $216,000 this year.

Five months into 2021, CoreLogic data shows prices have increased by 7% or more across Sydney, Melbourne, Brisbane, Adelaide and Perth since the start of the year. Sydney and Perth are set to top that, expected to rise another 8% by the end of 2021.

However, according to new research from the Commonwealth Bank, 58% of millennials said they intend to buy a home or investment property within the next five years.

The bank’s findings highlight the impact stagnant wage growth combined with property price surges have had on the first Australian generation for whom buying property is increasingly out of reach.

Further insights out of the property sector suggest Australian house prices could rise 10 times faster than wages in 2021.

While the average cost of housing in Australia was about 2.5 times the average household disposable income in 1990, according to the Reserve Bank of Australia (RBA), housing across the country is now priced at five times that.

The survey, which looked at the attitudes and habits of Australian millennials towards their personal finances, found that 61% say they don’t have a regular savings plan, with a third stating they only save occasionally.

In addition, a concerning 14% of the demographic aged between 25 and 38 told Australia’s biggest bank they lived paycheck to paycheck.

Finder’s Consumer Sentiment Tracker reports that millennials are saving $989 a month on average, with men doing better than women —- $1,207 and $767, respectively.

Kate Crous, CBA’s executive general manager of Everyday Banking, said the research suggests millennials recognise the importance of having a savings plan, with more than 50% saying they are keen to talk about strategies to get ahead financially, but don’t know how.

“The research found that only 39% actually have a savings plan that they work to each time they get paid,” Crous said in a statement.

“Often the cost of living can also get in the way, but many young Australians definitely want to be more in control of their spending so they can start focusing on longer term goals.”

Crous said that the survey, conducted during April 2021 at the very beginning of the pandemic lockdown, showed that the crisis sharpened millennial’s focus on long-term saving.

“With our research showing 14% of millennials are living pay cheque to pay cheque, the trouble with our present bias and focus on the here and now is that we can find ourselves stuck in a cycle of spending money, rather than watching our savings grow,” she said.

The research also highlighted the gaps between millennial perspectives around life milestones and their approaches to saving.

It showed 58% of millennials say they would feel “most like an adult” when buying a house, but less than a third have done so to date.

The cohort surveyed also counted milestones like saving more money than they spend, and moving out of their parents’ house, at 35% and 33% respectively.

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