Add CategoryAn accountant and a maths teacher in two Aussie cities are among those with second or third jobs now, amid warnings a $100k salary just isn’t enough to survive or own a home.
Latest Money.com.au analysis pushes the figure individual homeowners need to earn out past $120,000 now just to survive inflationary hits and interest rate rises. And it warns the average person should be working an extra two hours a week to regain buying power they’ve lost in the past few years thanks to inflation.
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Sidharth Sondhi, a full-time accountant, has two other jobs to cope with the cost of living rise.
Sidharth Sondhi, a full-time accountant, works an extra eight to 10 hours a week with an event organising agency in Sydney and drives Ubers on weekends to make ends meet.
“A few years ago, a $100,000 salary was considered a high-income, but with the current rate of inflation, a $100,000 salary is just mediocre these days,” he warned.
“The sad part is that low to middle-income earners have been hit the hardest by the cost of living crisis. In today’s economy, it’s increasingly difficult for someone on a low income to afford a home, especially with skyrocketing house prices.”
Mr Sondhi said “I don’t make six figures from accounting”.
“I can probably make six figures if I stretch my working capacity and if I work every weekend.”
Gold Coast science and maths teacher Sebastian Kath also works as an extra for movies and TV commercials to boost his buying power as inflation hits.
In rival state Queensland, Gold Coast science and maths teacher Sebastian Kath’s extra income comes from working two to three hours a week as an extra for movies and TV commercials.
“It’s harder for people to earn $100,000 now without working until the wheels fall off, and there’s that element of uncertainty for people who can’t get consistent work,” he said.
“With everyday expenses skyrocketing, even those who used to manage comfortably are now feeling the pinch. It’s a constant juggle just to cover the basics.”
He warned “the cost of housing in Queensland is astronomical”.
Things were looking so bad “I’m finding myself looking overseas for better value for my money”, he said.
The cost of living on the Gold Coast and across Queensland was “astronomical” now, Mr Kath said.
Almost a million people are now working two jobs or more to keep up with the cost of living according to the Australian Bureau of Statistics, rising from 818,700 in June 2021 to 974,000 in latest figures.
Money.com.au warned the average Aussie needs to earn $107,730 a year to weather the cost of living crisis, with the figure even worse for homeowners at $120,294 a year to absorb rising interest rates too.
Mortgage repayment costs have jumped by $12,564 a year for a loan that averaged $555,600 in mid-2021, according to money.com.au expert Sean Callery, with average owner occupier home loan rates rising from 2.84 per cent to 6.03 per cent in the past few years.
“Increasing living expenses and mortgage repayments are forcing many Australians to work extra hours just to continue putting food on the table and keep a roof over their head,” he said.
“There has been some relief in the form of higher interest rates on savings, energy rebates and the tax cuts filtering through from 1 July this year, but overall the picture has been fairly grim.”
The RBA board meets Sept 24 to discuss the cash rate target.
The Reserve Bank of Australia board is not due to meet until September 24, when their next monetary policy decision is due – specifically any changes to the cash rate target which has a flow on effect on residential mortgage rates among others.
In the past three years, inflation growth (19.7pc) has outpaced wage growth (12.2pc), he said.
“In other words, the average Australian has lost 7.5 per cent of their purchasing power” requiring an extra two hours of work a week to afford the same basket of goods and services, he said.
“Those higher interest rates are really stinging and a cut can’t come soon enough for a lot of people.”
The Money.com.au analysis was based on the average full-time, pre-tax salary in mid-2021 ($90,329 rounded to $90,000) needing to keep up with inflation (19.7%) from June 2021 quarter compared to June 2024 quarter.