I WISH I’D KNOWN SOONER!

c The Salvation Army Australia Southern Territory 2012

All rights reserved. Except for fair dealing permitted under the Copyright Act.

No part of this book may be reproduced by any means without the permission

in writing from the author/publisher.

National Library of Australia

Cataloguing-in-Publication data:

Brackertz, Nicola

I wish I’d known sooner!

Cataloguing in Publication entry is available from the

National Library of Australia catalogue.

ISBN 9780987218575

Printed on Envirocare –100% Recycled

This study was conducted for The Salvation Army by researchers at the

Swinburne Institute, Swinburne University of Technology (Melbourne) and

has been cleared by the University’s Human Research Ethics Committee.

Projects like these are not the making of one individual alone and many good people helped in the process.

The author would like to thank the women and men across Australia who took the time to answer this survey.

The information you provided will help us to improve the financial counselling service for all. Many thanks go to

The Salvation Army’s financial counsellors who made time in their busy schedules to assist in administering the

survey. Tracy Grinter, Maria Turnbull and Tony Devlin generously gave of their time in the exploratory phase of this

research and in the facilitation of the survey. Without their help this research would not have been possible.

Elli McGavin (Territorial Social Policy and Programme Development Manager) and Pamela Hanney (Doorways

Coordinator) from The Salvation Army not only instigated the research, but were active supporters and

co-collaborators throughout the process.

The Salvation Army acknowledges the ongoing support of Westpac for the Doorways philosophy that underpins

this research project.

At the Swinburne Institute the author would like to extend a special thanks to Liss Ralston who provided statistical

analysis, feedback and support throughout the project, and Edmee Kenny who was invaluable in the implementation

phase of the survey.

Executive summary.................................................................................................................................................................................. 1

Key findings............................................................................................................................................................................................ 1

Recommendations...............................................................................................................................................................................3

Introduction................................................................................................................................................................................................5

What is financial counselling?......................................................................................................................................................5

Key concepts..............................................................................................................................................................................................6

Financial literacy and financial capability......................................................................................................................................6

Financial exclusion............................................................................................................................................................................... 7

Causes and symptoms of debt and deprivation.......................................................................................................................... 7

Health and wellbeing..........................................................................................................................................................................8

Measuring the outcomes of financial counselling......................................................................................................................8

Methodology..............................................................................................................................................................................................9

Respondent profiles – who is seeking financial counselling?.................................................................................................... 11

Age and gender of respondents..................................................................................................................................................... 11

Language and ATSI............................................................................................................................................................................. 11

Income...................................................................................................................................................................................................12

Housing.................................................................................................................................................................................................12

Household type..............................................................................................................................................................................13

Research results......................................................................................................................................................................................15

The impact of financial counselling – client perceptions.......................................................................................................15

Debt resolution...............................................................................................................................................................................15

Advocacy..........................................................................................................................................................................................16

Financial capability........................................................................................................................................................................16

Health and wellbeing....................................................................................................................................................................16

In their own words............................................................................................................................................................................. 17

Level and duration of debt..............................................................................................................................................................18

Respondent perceptions of debt problems...........................................................................................................................19

Sources of debt.................................................................................................................................................................................. 20

Financial exclusion............................................................................................................................................................................. 21

Causes and symptoms of financial stress....................................................................................................................................22

Health and wellbeing........................................................................................................................................................................24

Findings..................................................................................................................................................................................................... 26

Conclusion and recommendations................................................................................................................................................... 28

Recommendations............................................................................................................................................................................ 28

Bibliography............................................................................................................................................................................................. 29

Appendix 1: Survey................................................................................................................................................................................. 31

Endnotes...................................................................................................................................................................................................35

1

Executive summary

In 2010, one in five Australian adults experienced financial stress and could not pay their bills, rent or mortgage on time or make minimum repayments on their credit cards, or had to sell or pawn something because they needed cash. Many of these sought assistance from friends, family and welfare and community organisations. Some had to go without meals or were unable to heat their home.

In mid-2012, The Salvation Army commissioned the Swinburne Institute at Swinburne University to undertake a survey of its financial counselling recipients. The aim of the research was to determine the impact of financial counselling on an individual’s ability to resolve or reduce their financial difficulties and increase their financial capability, as well as study the impact of financial counselling on their health and wellbeing.

A month-long short, anonymous survey was administered to recipients of The Salvation Army financial counselling

services Australia-wide. Where clients had trouble completing the survey because of language, literacy or

comprehension issues, financial counsellors assisted them. The survey elicited 225 responses. The demographic

and socio-economic characteristics of respondents mirrored The Salvation Army’s financial counselling clients

nationally. Consequently, survey responses can be seen as representative of the experiences of people accessing

The Salvation Army financial counselling services.

Five key findings emerged:

including the resolution of debt related problems, advocacy, financial capability and health and wellbeing. The

survey results suggest that financial counselling is an important service that demonstrably benefits clients on

multiple dimensions of financial stress.

inadequate incomes and the lack of suitable financial products and services, it helps mitigate immediate crisis,

providing information and education to assist people to develop longer-term financial management strategies.

Other studies have shown that many people with debt problems do not access advice services at all.1

This study found that many people wait a long time after the onset of financial difficulties before seeking financial counselling.

Survey respondents who had been in financial difficulties for a year or less:

Financial stress is a complex problem with interlinked and sometimes mutually reinforcing causes and effects

(stressors) that can mount and worsen as time goes on, leading people to become trapped in a cycle of debt. Early

intervention is more effective in resolving debt issues and can prevent stressors from accumulating. Conversely,

people who had been in financial difficulties for longer tended to experience a higher number of stressors that

negatively impacted on their finances and their ability to resolve financial stress.

associated with financial difficulties.

Financial counselling also helped reduce the negative impact of environmental stressors, such as interpersonal

relationships and housing security, which if left unchecked may exacerbate financial stress.

and their children (46%) had improved.

Women are disproportionately represented in financial counselling, making up over two-thirds of respondents,

which mirrors the general client base of The Salvation Army financial counselling services.

whilst the median amount of debt owed was $5,000 to $10,000.

of $20,000) compared to women, a statistically significant difference.

lasting for more than five years compared to 12% of women (12%).

The prevalent sources of debt also differed:

3

This study presents a snapshot in time only, and as such suggests the need to better understand the reasons why

people delay accessing these services and the ongoing impacts of financial counselling. The fact that many clients

experience long-term financial stress may indicate that not all of the benefits of financial counselling endure or

accrue to the same degree for all individuals.

The survey also highlights the reality of debt and financial problems for individuals and families on such

constrained incomes. Whilst financial counselling can assist to alleviate acute financial crises, it cannot solve the

broader structural issues of social and economic disadvantage that contribute to the exacerbation and impact of

financial stress.

1. To maintain and expand current financial counselling services.

2. To advocate for and continue to work towards integrating financial counselling into a holistic approach to

meeting the needs of individuals and families as demonstrated by The Salvation Army Doorways philosophy.

3. To support financial counselling as a tool for early intervention and individual capacity building within a

holistic case management approach to social and economic disadvantage, as per The Salvation Army

Doorways philosophy.

4. Address the barriers that prevent people from accessing financial counselling:

a) Develop and facilitate a communication and media strategy that promotes greater awareness of the nature,

benefits and accessibility of financial counselling services.

b) Undertake research to better understand the barriers that delay and prevent people from accessing financial

counselling services and develop strategies to overcome these. This may include different approaches for

different cohorts, for example, men and women and people in long- and short-term financial stress.

c) Undertake research to better understand the long-term impacts of financial counselling.

4

5

Introduction

Financial stress is a significant problem for one in five Australians, disproportionately affecting those on low

incomes, pensions or allowances payments.2 It is detrimental not only because it causes individual and family

hardship, but also because of the effect on the wider community. Debt is not solely the result of poor financial

literacy or inadequate budgeting. Life events such as loss of employment or family break-up, external causes such

as increasing costs of living and decreasing housing affordability, structural factors such as lack of appropriate and

affordable financial products and services, and other reasons such as ‘predatory’ credit practices can all trigger a

financial crisis.

Financial stress can mean that people are unable to afford essential items such as food and heating or may not be

able to pay their bills. It is also a source of stress and anxiety which negatively affects people’s health and ability

to cope.

The Salvation Army provides free and confidential financial counselling to those in financial difficulties, and in the

year 2011-12 provided assistance to more than 10,000 people Australia-wide. The service is delivered either faceto-

face or by telephone.

This national survey of 225 financial counselling clients was commissioned by The Salvation Army and conducted

by the Swinburne Institute at Swinburne University in Melbourne in July 2012. The study investigated the impact

of The Salvation Army’s financial counselling service on clients’ ability to resolve or reduce their financial difficulties,

as well as health and wellbeing and financial capability outcomes. The research connects with broader debates

about how financial literacy, financial capability and financial exclusion link with issues of poverty, social inclusion

and health and wellbeing.

Financial counsellors provide an important service to people who are experiencing financial stress, many of whom

are on low incomes and may be having difficulty coping with their situation. Money management is only one aspect

of financial counselling. Financial counsellors also negotiate with creditors on clients’ behalf, determine if clients

are eligible for government assistance or hardship programs, and assist in accessing these programs. They provide

information on the options and consequences of debt recovery procedures, bankruptcy and other alternatives.

When necessary and where indicated, financial counsellors may refer clients to services such as community legal

aid, personal counselling, gambling help or family support.

The combination of advocacy, empowerment, education and service linkage functions underpin the community

development approach and social justice principles of financial counselling. Through this approach, financial

counselling aims to provide short-term crisis management as well as longer-term and prevention strategies.

Financial counsellors work in community organisations, community legal centres and some government agencies.

Their services are free, independent and confidential.

Financial counselling is funded as part of the Commonwealth Financial Counselling (CFC) service strategy under

the Australian Government’s Financial Management Program (FMP) which is administered by the Department of

Families, Housing, Community Services and Indigenous Affairs (FaHCSIA). FMP ‘aims to build financial resilience and

wellbeing for vulnerable people and those most at risk of financial and social exclusion and disadvantage’.3 States

and Territories also fund financial counselling services.

In 2011-12, nearly 100 community and local government organisations received approximately $15.3 million of

funding to deliver CFC across Australia.4 The Salvation Army, a recipient of this funding, supplements these funds

with their own resources to enhance service coverage and accessibility. The adequacy and security of funding for

financial counselling services is an ongoing problem, as is the number of services available and the waiting times

involved in accessing the services.

The need for financial counselling cannot be considered solely as a matter of debt. While financial literacy and

budgeting ability are factors in financial stress, individual, circumstantial and structural issues frequently conspire

to place low income, marginalised or vulnerable individuals, families and groups in precarious financial situations.

The ramifications of this are serious for the affected individuals and for society more broadly, and are linked to

social and financial exclusion, poverty and deprivation, and diminished health and wellbeing. These issues underpin

this study.

There have been a number of important Australian studies on financial literacy in the past decade. These include the ANZ Adult Financial Literacy in Australia survey which was conducted four times between 2003 and 2011, and identified that certain groups have lower levels of financial literacy: young people under 25, people with no formal post-secondary education, people with relatively low levels of income and assets, blue collar workers and women.6

Financial education is a key theme in financial literacy. However, more knowledge does not necessarily translate into changed behaviours, and financial literacy alone does not guarantee the resolution of financial difficulties. For a financial literacy program to be successful, it must take into account and seek to positively influence people’s financial attitudes as well as to increase financial knowledge and literacy and lead to behaviour change.7

Furthermore, not all people have the same opportunities to actualise their financial literacy, as income levels, income security and systemic factors may present barriers. Consequently, provision of adequate structural elements such as consumer protection and appropriate and affordable financial products and services are necessary, alongside adequate income support and regulation.

To account for these issues, many writers have advocated that financial literacy should be understood in relation to an individual’s behaviour according to context and not solely based on their financial knowledge.8 This is embodied in the concept of financial capability which was adopted for this study. The most widely recognised framework for financial capability was developed by Atkinson and her colleagues at the University of Bristol in the UK.9 They see financial capability as encompassing how financial literacy translates into changed behaviour and accounts for circumstantial and structural factors. Its four key aspects are:

While financial capability is a more inclusive way of thinking about the skills and behaviours required of individuals in relation to their management of finances, it does not address factors such as the availability and accessibility of suitable financial products and services for all demographics. Full participation in economic life also requires, in addition to financial capability, the opportunity to act on these capabilities. This points to the key role institutions and policies have in creating a fair and equitable structural environment.

7

Financial exclusion is one way of looking at the structural factors that may prevent individuals, groups and

communities from fully participating in economic life. In essence, financial exclusion looks at the availability of

appropriate and affordable financial products and services. In Australia, the Centre for Social Impact, together with

the National Australia Bank (NAB), has conducted a large-scale survey of financial exclusion and developed a set

of financial exclusion indicators. They concluded that around 15.6% of the population (2,650,000 individuals) were

either fully or partially financially excluded from financial services in 2010, rising to 17.2% in 2011.10

Simply having a particular financial product (i.e. savings account, loans, and insurances) may be a misleading

indicator of financial inclusion, primarily because government pensions and allowances can only be paid through

bank accounts. People may be excluded from some financial products and services but may be over-represented

in the use of others (e.g. credit cards, payday loans) which do not suit their needs but exploit their vulnerabilities.

The cost of certain financial services and products may be prohibitive for persons on low incomes. The Centre

for Social Impact calculated that, based on the average cost of the top 10 bank accounts and top 10 credit cards

that are designed for low income consumers, the annual cost of a basic bank account is $88 and a low cost credit

card $808. If one adds to this the cost of basic motor vehicle and basic home and contents insurance which was

calculated at $898, then the average annual cost for basic financial services is $1,794, presenting a considerable

barrier to financial inclusion for persons on a low annual income.11

This study adopted a simple measure of financial exclusion that is aligned with the indicators used by the Centre for

Social Impact. A person was considered to be (partially) financially excluded if they could not afford one or more of

the following: a basic savings or transaction account, a small loan from a bank or similar financial institution (not a

payday loan), comprehensive motor vehicle insurance and home contents insurance.

The impact of financial exclusion on individuals is significant; they face difficulties accessing funds in an emergency,

are more likely to struggle meeting major repayments, are significantly less likely to have insurance to cover their

key assets (e.g. car) and are more likely to use fringe credit providers (e.g. payday loans or Cash Converters),

thereby incurring a high cost of credit.12 They are also more likely to access government emergency payments and

community loan schemes.

It is important to recognise that financial exclusion impacts not only on individuals, but also carries a societal cost

at community and economic levels.13 It is intertwined with issues of financial capability, poverty, debt and social

exclusion, and is part of a series of interconnected processes that have numerous interrelated causes. A clear

directionality of cause and effect is difficult to disentangle, and financial exclusion may be either a cause or a

consequence of social exclusion and poverty.14

Disadvantage is both a contributor to and a symptom of debt problems.15 Debt is a serious ongoing social and

economic problem for the whole community but one that affects the disadvantaged most severely.16

A study by the Legal Services Research Centre in the UK identified three types of causes of debt: changing

circumstances, poor money management and creditor behaviour. It confirmed what is captured in the wider

literature, namely, that debt problems stem from a variety of causes, such as changing circumstances, ill

health, relationship breakdown, loss of employment, parenthood, credit over-commitment and poor money

management. 17 Many people with debt problems lead unstable lives and move house frequently and it is often a

combination of events that provides the trigger for a debt crisis.18

Debt negatively impacts on peoples’ lives in a number of areas, including health (physical and mental), relationships

with family and friends,19 work, social networks, housing status, employment, education and plans for their future,

making it hard to carry on living normally.20 When debt problems are considered in the context of the multiple

contributing stressors (e.g. loss of employment, illness, family break-up) and in relation to social exclusion and

disadvantage, it is not surprising that many people may not make debt their priority consideration until it reaches

crisis point. Consequently, assistance to resolve debt issues often involves resolving other difficulties. It is not

unusual for people to experience a cycle of debt during which causes mount and increase.

Debt problems are a significant cause of emotional stress, and the literature consistently identifies the link between

physical and mental illness and debt problems.21

The link between debt, stress and anxiety is particularly strong.22 A UK study found that 89% of clients reported

worrying about money problems ‘most of the time’ and 48% believed that debt problems had a ‘great’ impact on

their health, with another 43% indicating that debt had ‘somewhat’ negatively affected their health; around three

in five had sought treatment, medication or counselling as a result.23 These findings are mirrored in the Australian

Bulk Debt Negotiation Project24 where 47% of clients represented experienced some form of ill health, including

mental illness, and in research by Wesley Mission which confirms the significant impact of debt and financial stress

on health and wellbeing.25

Debt and deprivation limit access to medical care, sometimes with serious consequences. Research from the USA

shows that households with high debt levels are less likely to seek healthcare.26 Australia has a system of universal

health care, meaning that people are generally able to access required medical treatments, regardless of their

ability to pay. However, there are a small percentage of Australians who struggle to access bulk-billing doctors, may

be on long waiting lists for treatments, and some are not able to afford the medicines prescribed.27 Dental care is

not part of the universal health system, and the expense is prohibitive for many people on low incomes or who are

experiencing financial stress, with Saunders and Wong indicating that in 2008 only 45% of their sample were able

to access dental treatment when needed,28 and The Salvation Army reporting that 57% of their Emergency Relief

clients were not able to access needed dental treatment in 2012.29

In recognition of the fact that health and wellbeing are important causes and symptoms of financial stress, this

study included a number of questions that aimed to ascertain respondents’ ability to afford healthcare and their

mental and physical wellbeing.

In the same way that financial stress can negatively affect many areas of peoples’ lives, so too debt advice can

have a variety of impacts, not all of which are directly related to financial issues. In order to capture a broad

range of financial counselling outcomes, this study utilised a range of measures targeted at identifying the issues

outlined above.

A framework of financial capability was adopted to develop reference points for desirable outcomes. The survey

sought to determine:

provided positive advocacy outcomes, affected health and wellbeing and contributed to

developing financial capability.

This framework allowed key themes to be analysed in relation to each other and to be correlated with socioeconomic

data. The demographic characteristics of survey respondents mirror, in terms of age, gender, proportion

of non-English speakers and proportion identifying as Aboriginal or Torres Strait Islander (ATSI), The Salvation

Army’s financial counselling clients nationally. Consequently, survey responses can be seen as representative of the

experiences of Salvation Army financial counselling clients nationally.

9

Methodology

A short paper-based survey was administered to individuals accessing The Salvation Army’s financial counselling

services nationwide between 1 July and 3 August 2012. The survey was voluntary, anonymous and confidential. Ethics

clearance for the research was sought and granted by Swinburne University’s Human Research Ethics Committee.

The survey aimed to establish an individual’s evaluation of the impact of financial counselling, as well as their

circumstances, influential structural factors, behaviours and wellbeing (psychological and physical). Due to the

sensitive nature of the issues and because many potential respondents are hard to reach for research purposes

(low income, marginalised and vulnerable persons), a number of practical and methodological challenges had to be

overcome. The success of the strategies outlined below resulted in 225 completed surveys being returned.

It was anticipated that many clients would be able to complete the survey on their own, but it was also known

that some had low literacy, insufficient English language skills, or led fractured, chaotic lives, making them unlikely

to complete and return the questionnaire (estimated at about 40% of clients). But it is just these groups who

may benefit most from financial counselling, and researchers felt that it was important to capture their responses.

Consequently, financial counsellors were asked to assist with the implementation of the survey.

Survey packs containing an information statement for financial counsellors and 20 participant bundles that

included the survey, a plain language statement and reply paid envelope were sent out to 60 financial counsellors

(or financial counsellor managers). A total of 1,200 surveys were delivered across 48 sites within each State and

Territory. These packs were sent to financial counsellors following an introductory email. The initial mail-out was

followed with a telephone call to each site by the research assistant over the next two weeks (18 June to 6 July).

The purpose of the follow-up call was to ascertain that all survey packs had reached their destination and to

provide further clarification. The call also established a direct point of contact for support and feedback for those

administering the survey.

This initial contact process highlighted that a small number of financial counselling sites would not be operating

for different lengths of time during the survey period (approximately 10 sites in total –two not at all and eight for

differing periods). This was primarily due to financial counsellors taking leave, but was also due to staffing issues

in at least two sites.

Financial counsellors were directed to ask all individuals over the age of 18 (except first time users of the service

and persons who may experience emotional or psychological trauma as a result of answering the questions)

using the service during the survey period whether they would like to participate in the survey. People were given

the option to (attempt to) complete the survey while they were waiting for their scheduled appointment and

could then consult with the counsellor if there were questions they did not understand or if they had literacy or

language issues.

Individuals were given the option of sealing the completed survey in the provided prepaid and addressed envelope

and giving it to their financial counsellor (who then forwarded it to the researchers) or they could post their

response themselves.

In the second and third weeks of the survey period (9 to 20 July), telephone calls were made to sites where initial

contact had yet to be made and to reiterate key details with specific sites. For example, a number of returned

surveys had been completed by first time recipients of financial counselling, who were not the target group for the

survey. In the final week of data collection, every site was contacted to confirm that while this was officially the

final week, all surveys posted no later than 3 August would be accepted. The timeframe was extended in order to

maximise the number of responses. Financial counsellors were asked to return unused surveys.

Throughout the survey period, the process of contacting sites allowed the research assistant to troubleshoot with

those financial counsellors who were unable, for a variety of reasons, to administer the survey face-to-face. One

of the primary reasons was that they simply did not have time to do so, with many noting that they were working

part-time, and that individuals who fit the survey respondent profile were not scheduled to visit the service during

this period. Consequently, the option of sending out surveys to those who fit the required profile was introduced.

service, those clients identified as fitting the respondent profile would be mailed out the survey for completion.

Based on this precedent, when advised of issues administering surveys face-to-face, it was decided that the option

of mailing out the surveys should be made available to all sites. On 10 July an email was sent advising all financial

counsellors that they could employ this approach, should they have regular clients who would not be attending

an appointment during the survey period. They were advised to use their judgement to determine who should be

sent the survey and to follow up with these clients. The total number who received the survey by mail is unknown,

but approximately seven sites advised that they had sent out the survey advising clients to return (via reply paid

envelope) of their own volition.

Data from completed surveys was entered into an Excel spread sheet and analysed using SPSS. The survey was

structured to allow for analysis of key factors which included financial capability, health and wellbeing, financial

exclusion, and client perceptions of financial counselling outcomes.

11

Respondent profiles:

who is seeking financial counselling?

The survey elicited 225 responses, of which 67% were by women (n=151), 31% by men (n=70) and 2% of

respondents did not state their gender (n=4). Most respondents (52.9%) were 34-54 years of age. Persons aged

25-34 constituted another large group (19.1%).

This suggests two important things. First, women are more likely to seek assistance in alleviating debt on behalf of

themselves and their households. Second, the middle years of adulthood (34-54) where people have to juggle the

responsibilities of parenting, caring for others and work are the time when they are most vulnerable to financial

stress. This is in line with findings from research on who seeks emergency relief because they are finding it hard to

make ends meet.31

The survey asked whether respondents spoke a

language other than English at home and whether

they identified as Aboriginal or Torres Strait Islander

(ATSI). Most were native English speakers (84%), which

is a slightly higher proportion than for the overall

population where 80% of people speak only English at

home.32 That is, persons seeking financial counselling

from the Salvation Army are slightly less likely to be

from a non-English-speaking background, though this

difference is not statistically significant.

The high number of respondents identifying as ATSI

stands out. Respondents were almost three times more

likely to identify as ATSI (7%) than the Australian average

(2.5%).33 The high proportion of ATSI clients points to

high levels of financial stress within that community.

18–24

years

25–34

years

35–44

years

45–54

years

55–64

years

65+

years

0

20

60

70

40

10

30

50

Female

Male

37

11

32

39

22

16

42

8

18

10

13

Native English

speaker

84%

Not stated

2%

Language other

than English

14%

No

91%

Not stated

2%

Aboriginal or TSI

7%

The survey asked respondents for their main source of income. The overwhelming majority stated that this was a

government pension or allowance (79.1%). A smaller proportion (14.7%) received wages or salary (including from

their own business), with only a few respondents indicating workers or transport compensation (1.8%) and selfemployment

(1.3%) as the main source. This points to the difficulty of making ends meet on a pension or allowance

The cost of housing in Australia is high, with Melbourne and Sydney being among the 15 most expensive cities in

the world.37 For low income earners, the cost of housing is a key contributor to financial stress. The survey asked

respondents in which type of housing they lived.

Most respondents were private renters (39.1%) or were paying off their mortgage (20.9%). Public or community

housing renters constituted 21.8% of respondents. Few owned their home outright (4.9%) or lived with relatives

(3.6%) or friends (1.3%). Only a small proportion were living in transitional housing, crisis/short-term accommodation

or a caravan/car (1.3% each).

In the current tight rental market that has a significant shortage of low cost rental properties, the high proportion

of private renters in this survey cohort suggests that for many who are also in receipt of pensions and allowance

payments, the costs associated with housing are an evident pressure.

Survey data also clearly shows that public housing, where the rent is capped at 25% of income, is no guarantee of

protection from financial stress. Recent research on housing affordability found that ‘low income public renters ...

13

have the most severe affordability problem ..., which contradicts the false assumption that the 25% household rent

formula shelters such tenants from an affordability problem’.38 Rather than the commonly used measure where

30% of income is set as the benchmark for housing affordability, regardless of the person’s income, this study used

a more nuanced residual model of housing affordability. It applied a budget standard model to determine how

much money is left over for rent after the essential items of living are paid for, which provides a good indicator of

housing and financial stress.39 If a low cost budget standard is applied, the residual model showed that 69.1% of

public renters and 47.7% of private renters experience housing affordability problems.40

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Private rental

Public or community housing

Paying o mortgage

Home owner

Living with relatives

Not stated

Other

Caravan/car

Crisis/short-term accommodation

Transitional housing

Living with  iends

Share house with unrelated people

Homeless or living-in-crisis accommodation

39%

22%

21%

5%

4%

2%

2%

1%

1%

1%

1%

1%

0%

Most respondents lived alone (34%), with sole parents the second most numerous group (28%). Taken together,

the data showed that 62% of respondents lived in single income households. This suggests how sensitive single

income families are to cost of living pressures, with costs for rent and utilities being almost as high for a sole person

as they are for a couple, but without the extra income to offset this. It also indicates that government payments to

Living

alone

Sole

parent

Living with

a spouse or

partner with

dependent

child/ren

Couple

only

Living in

a share

house

with family

Living in

a share

house with

unrelated

adults

Living with

a spouse

or partner

without

dependent

child/ren

Other

0

20

60

80

70

40

10

30

50

Male

Female

33

42

4

57

24

7

6

14 11

5

6

4

1

4

2/1

was analysed by gender. Men were most likely to be living alone (47%), while most female respondents were sole

parents (38%). Among sole parents the gender divide was most pronounced, with only four of 61 being male. This

may reflect two sides of the same coin, as women are more likely to have custody of the children after family

break-up, as well as the caring and financial responsibilities that come with this. This leaves men to either live on

their own or share a house with family (16%) or unrelated adults (9%) (men are more prevalent in each of these

categories to a statistically significant degree).

It is interesting that women are more likely to be the person seeking financial counselling in households where they

live with a partner or spouse and dependent children (15.9%), and it is suggested that this may reflect the gender

divisions of household labour.

15

Research results

In order to determine the impact of financial counselling, respondents were asked to indicate their agreement on a

five point scale (strongly agree to strongly disagree) with a series of statements. The benefits identified were many

and varied, and overwhelmingly positive. Self-reported outcomes in the areas of debt resolution, advocacy, health

and wellbeing and financial capability all showed high levels of agreement that the service had helped them. The

fact that 94% of respondents agreed or strongly agreed that they would be willing to seek help sooner as a result

of attending the financial counselling service attests to its efficacy.

0% 20% 40% 60% 80% 100%

Advice helped me avoid bankruptcy

My housing situation is more secure

My
nancial situation has improved

My
nancial diculties were resolved

I feel more positive about the future

My physical health has improved

My mental and/or emotional wellbeing has improved

I worry less about money problems

My relationship with my children has improved

My relationships with my family and �iends have improved

I would be more willing to seek
nancial help earlier

I feel be er able to save

I have access to no interest or low interest loans (e.g. NILS)

I have more awareness of my bene
ts entitlements

I feel be er able to choose
nancial products that
t my situation

I feel be er able to prioritise debt

I feel be er able to budget

Advice helped me avoid or curtail legal action

I have had debts or
nes waived or reduced

I have been able to access utility relief grants

I now have access to creditors’ hardship programs

53%

51%

68%

66%

69%

45%

63%

52%

46%

45%

94%

37%

36%

70%

62%

75%

74%

74%

48%

59%

73%

40% or less 41–60% 60% or more

Advocacy Financial capability Health and wellbeing Debt resolution

A positive picture emerges of the financial counselling service’s contribution to resolving clients’ financial difficulties.

More than two-thirds agreed or strongly agreed that ‘My financial situation has improved’ (68%) and ‘My financial

difficulties were resolved’ (66%). Over half thought that ‘Advice helped me avoid bankruptcy’ (53%) and ‘My housing

situation is more secure’ (51%).

A similarly positive response was evident in client perceptions of the financial counselling service’s advocacy.

Almost three-quarters agreed or strongly agreed that ‘Advice helped me avoid or curtail legal action’ and ‘I now

have access to creditors’ hardship programs’. The service’s advocacy aided 59% of clients in accessing utility relief

grants, and nearly half of all clients had debts or fines waived or reduced. This attests to the efficacy of the financial

counselling service in alleviating acute financial stress by advocating on behalf of clients.

A mixed response was evident in relation to financial capability. On the positive side, almost all respondents (94%)

indicated that they would be willing to seek help sooner, which shows that their experience with the service made

a positive difference and that they now knew where to seek help and information in a financial crisis.

Nearly two-thirds were better able to prioritise debt (75%) and budget (74%) as a result of attending the service.

A large proportion also felt that they now had more awareness of their benefits and entitlements (70%) and

were better able to choose appropriate financial products (62%). This represents a very pleasing outcome that

shows the educational benefits of financial counselling in terms of helping people to manage their money, choose

products and stay informed.

Over a third of clients (37%) felt that they were now better able to save. Given the limited financial resources of

the majority of the survey cohort (i.e. in receipt of a pension or allowance payment) this represents a significant

achievement for individuals and families. However, it also suggests that as a means of planning ahead for

unforeseen circumstances, saving on a limited income is not only a function of financial capability, but also of

available resources. Saving may not be a realistic option given the limited financial resources of many.

Just over a third (36%) of respondents indicated that they had access to low interest or no interest loans (NILS)

as a result of using the financial counselling service. This is a positive outcome for people whose acute financial

stress may be due to, or exacerbated by, the need for an essential household item. There are a number of possible

reasons this number is not higher. NILS may not be appropriate for a number of clients, NILS may not meet the

credit needs of certain types of clients, and very limited incomes and poor credit history may prevent some clients

from accessing NILS.

These results show that while individuals can make great strides in improving their financial capability, there are

underlying structural factors, such as the adequacy of allowance payments income and the availability of suitable

credit, that pose barriers to people on low incomes.

Respondents agreed that financial counselling had positive flow-on effects for their health, especially where

mental health and wellbeing were concerned. Over two-thirds (69%) felt more positive about the future, 63%

agreed that their mental and/or emotional wellbeing had improved and just over half (52%) now worried less

about money problems. These wellbeing effects also extended to relationships with their friends and family, which

45% of respondents felt had improved, and their children, where 46% agreed or strongly agreed. Positive effects

on physical health were also recorded, with 45% indicating an improvement.

17

Respondents were asked whether they had any comments on the financial counselling service. Their remarks are

insightful and complement the quantitative findings from the survey.

One theme that came through very strongly and that was commented on often was:

Two reasons emerged why people did not seek help sooner. Some did not know about the service. This was

expressed in comments like:

and

The other reason was embarrassment:

One way that counsellors helped clients to overcome embarrassment was by listening. Clients felt counsellors

cared and were non-judgemental and sensitive to their issues. This was commented on often and was singled out

as an important and positive feature of the service.

The beneficial effect of financial counselling on people’s emotional wellbeing came through very strongly and was

in part founded in a trust which clients felt in their counsellor and their abilities.

and

Financial counselling gave clients a sense of empowerment and made them feel able to cope with their problems.

These comments suggests that financial stress is a sensitive issue and that many people delay seeking help because

of embarrassment, because they don’t know that help is available, or because they think it’s too hard to deal with

their situation and nothing can be done. Once people use the service, they begin to feel more positive about their

situation when they are shown that there are strategies and actions they can take to alleviate their current crisis.

Respondents were asked to estimate their level of debt from all sources, excluding their mortgage, but including

credit cards, store cards, car loans, rental arrears, gas or electricity arrears, and loans from banks and friends.

The median amount of debt owed was $5,000 to $10,000, but almost a third had debts in excess of $20,000.

Men (42.9%) were more likely to a statistically significant degree to owe a large sum of money (more than $20,000)

than women (26.5%). Women were more likely to owe sums ranging from $3,001 to $20,000.

None Less than

$500

$501 –

$2,000

$2,001 –

$3,000

$3,001 –

$5,000

$5,001 –

$10,000

$10,001 –

$20,000

More than

$20,000

0%

5%

15%

25%

45%

50%

35%

10%

20%

30%

40%

Female

Male

More than half of respondents (56%) were experiencing long-term financial stress, lasting two years or more. Men

were more likely to have been in debt for a long time, with 20% answering that they had experienced financial

stress for more than five years, compared to women (11.9%).

19

The survey asked respondents how long after the onset of financial difficulties they had waited before seeking

financial counselling. Data showed that 44% had delayed a year or longer before seeking assistance from a financial

counsellor. This is important, as there is a statistically significant correlation between the duration of financial

difficulty experienced and the likelihood that financial difficulties were able to be resolved.42 While almost two-thirds

of respondents agreed or strongly agreed that financial counselling had helped to resolve their financial difficulties

(fig. 6), only 60.3% of those who had experienced long-term financial stress answered favourably, compared to

72% of those who had experienced financial difficulties for a year or less. This demonstrates that seeking financial

counselling early on in a financial crisis increases the likelihood of resolving the debt problem. It also demonstrates

the persistent nature of debt problems for people on low incomes.

I sought

help straight

away

About

6 weeks

About 2-3

months

About 4-6

months

One year Longer than

one year

Not

stated

0%

10%

30%

35%

2%

20%

5%

15%

25%

12%

8%

14%

20%

15%

29%

Respondents were asked whether they thought their

financial difficulties were likely to be temporary or

ongoing; 37% thought the problem was temporary and

43% thought the problem was an ongoing one.

There was a statistically significant correlation between

the amount of debt owed and feeling that debts

were likely to be ongoing.43 Men (48.6%) were more

likely to think that their financial difficulties would be

ongoing than were women (39.7%), possibly because

they have higher levels of debt and tended to have

been in financial stress for longer. This suggests that

respondents had fairly accurate perceptions of their

financial situation.

Temporary

37% No current

financial

difficulties

2%

Not stated

1%

Don’t know

18%

Ongoing

43%

The survey asked respondents to indicate the reasons for their financial difficulties, allowing for multiple responses

from a predefined list. Most respondents had multiple sources of debt, with between two and four sources being

the most common. However, 14.7% had five or more sources, with one facing 10 sources.

Utilities (56%) were the most common reason, followed by credit or store cards (42%), telephone and ITC debts

(28%), personal loans (21%) and mortgages (20%). Fines (16%), loans from family members (16%), car repairs (12%),

rental arrears (12%), payday loans (11%) and car loans (11%) were less frequent.

0% 10% 20% 30% 40% 50% 60%

Utility debts

Credit card or store card debt

Telephone/internet debt

Personal loan (
om bank or building society)

Mortgage repayments

Fines (speeding, parking, public transport, etc.)

Loan
om family member/
iend

Mechanics repairs and/or car accident

Rental arrears/eviction notice

Car loan

Payday loan (e.g. Cash Converters, pawnbrokers)

Debts
om former partner

Child support owed

Taxation debt

Centrelink overpayment

Registered with Centrelink but still awaiting bene.t

Business debt

No debts

Gambling debt

Centrelink payment suspended

56%

42%

28%

21%

20%

16%

16%

12%

12%

11%

11%

9%

7%

5%

4%

3%

3%

2%

1%

1%

Statistically significant differences were observed between men and women on some key items.44 Women were

more likely to nominate costs associated with running a household, such as utilities (60%) and telephone/ITC debts

(32%) (compared to 47% and 21% of men respectively). Men more frequently nominated debts to lending agencies,

such as personal loans (25%), mortgage repayments (29%) and payday loans (16%) as sources of debt, than did

women (20%, 16% and 9% respectively). It is difficult to speculate on the reasons for this difference. It may be

that women are more likely to seek financial counselling for outstanding bills, rather than seeking further credit to

cover the cost. With a significant proportion of the female respondents being represented as sole parents or living

alone, it is suggested that many will be in receipt on allowance payments which may present as a major barrier to

accessing loans.

21

0 10 20 30 40 50

Retrenchment/unemployment/underemployment

Government allowance too low/insucient income

Health/disability/mental health

Credit card or store card debt

Bills (utilities, phone)

Family break up/death of partner or close relative

Can’t pay debt

Rental arrears/eviction notice

40

33

24

21

21

20

14

11

When asked to indicate in their own words the main reasons for their current financial stress, respondents’

answers showed that the leading causes were insufficient income caused by retrenchment, unemployment,

underemployment and an insufficient level of government allowances and pensions. Health reasons, including

disability and mental illness, often prevented respondents from earning sufficient income. Financial pressure

was felt strongly through an inability to pay bills (utilities and phone), and as a consequence many respondents

used credit and store cards to cover expenses. An inability to repay credit or store card debt was the next most

frequently cited contributor to financial stress. Family break-up or the death of a partner or close relative also

strongly contributed.

In order to determine the degree to which respondents experienced financial exclusion, the survey asked them

to indicate how many, if any, of four basic financial products and services they could afford: a basic savings or

transaction account, a small loan from a bank or similar financial institution (not a payday loan), comprehensive

motor vehicle insurance and home contents insurance.

0 1 2 3 4

0%

10%

30%

20%

5%

15%

25%

14%

27%

20%

23%

16%

Only 14% of respondents indicated that they were fully financially included in the sense that they could afford all

four of these essential financial items. On the opposite end of the spectrum, 16% were fully financially excluded,

meaning that they could afford none of the items. A further 23% did not have three of the items and 20% had

only two.

other financial institution, which is not surprising, given their debt problems or precarious or low incomes. It also

highlights that in order to access funds to cover small emergencies or unexpected expenses, the great majority of

respondents may need to turn to more expensive sources of credit (such as credit cards, store cards, payday loans)

whose cost will further exacerbate their debt crisis. The other avenue is to access money through the informal

economy, such as borrowing from family and friends.

0% 10% 20% 30% 40% 50% 60% 70% 80%

Small loan

Home contents insurance

Comprehensive motor vehicle insurance

Basic savings/transaction account

72%

54%

44%

32%

This is corroborated by survey data which shows that 41.9% of respondents had credit card or store card debt, 15.7%

had borrowed money from family or friends, and 11.1% had taken out payday loans, one of the most expensive

forms of credit (fig. 10).

A high proportion also indicated they could not afford home contents insurance (54%) or comprehensive motor

vehicle insurance (44%), making them vulnerable in the case of accidents or unforseen events, which can then

further exacerbate their financial stress.

About a third (32%) of respondents indicated that they did not have a basic savings or transaction account. This

report put the figure of people who do not have a basic bank account at 14.8%.45 It is possible that a number of

respondents misunderstood the question as asking whether they had a savings account, rather than a transaction

account, as it is unlikely that such a high proportion of respondents did not have a basic bank account. The

accuracy of the figure is questionable, as a large proportion (79.1%) of respondents received government pensions

or allowances which can only be paid into a bank account.

Taken together, the data demonstrates that most respondents were unable to afford basic financial products and

services, which prevented them from fully participating in economic life and made them vulnerable to unforseen

adverse events, which may exacerbate their financial stress.

Financial stress rarely stems from one isolated reason

and its effects are interconnected and complex. A clear

chain of cause and effect cannot usually be identified,

and any number of stressful life events can either cause

or result from financial difficulties.

Respondents were asked to indicate from a list, allowing

multiple responses, whether in the past year they had

experienced any of a set of events (stressors) that can

contribute to or result from financial stress. These

stressors are cumulative, and the more stressors a

person experiences in a given period of time, the more

likely they are to experience financial stress.

Results show that 41% of respondents experienced

three to five stressors in the past year, with 29%

experiencing a high number (six to nine).

9% Nil

41% Medium

3-5 Stressors

22% Low

1-2 Stressors

29% High

6-9 Stressors

23

Perhaps not surprisingly, 68% of financial counselling clients had felt stressed about the future, and 41% had

experienced harassment from creditors.

For purposes of analysis, stressors were grouped thematically in categories of health, new credit/dissaving measures

(e.g. selling or pawning items), reduced income, family issues and addiction. Issues related to health were most

prevalent, followed closely by events related to credit/dissaving measures. Stressors related to substance abuse

and gambling constituted only 6% of responses. This may be due in part because there are specialist gambling

counselling services, which were not included in the sample, in a number of states.

0% 20% 40% 60% 80%

Felt stressed about the future

Mental illness

Prolonged or chronic illness

Disability

Physical injury that impacted on your ability to work

Caring duties due to illness of partner or dependant

Harassment �om creditors

Borrowed to repay debt

Taken on new debt (loans, credit card, etc.)

Needed to sell or pawn possessions

Moved to more a.ordable housing

Reduction in working hours

Retrenchment

Relationship/family break-up

New con.ict with your family

Domestic violence

Birth of a child

Death of a partner

Drug dependency

Alcohol dependency

Gambling

None of the above

68%

29%

24%

23%

20%

15%

41%

29%

26%

26%

21%

22%

12%

24%

24%

11%

7%

3%

6%

6%

6%

2%

Addiction Family issues Reduced

income

New credit/

dissaving measures

Health

Overall the data showed a link between the number of stressors indicated and the duration of debt. When the

number of stressors a person was experiencing was correlated with the amount of time they had been in financial

stress, a clear correlation became evident. The longer a person had been in financial difficulties, the more stressors

they were likely to experience. This confirms that stressors are cumulative and means that the longer a person

remains in debt, the harder it becomes to break out of the debt cycle.

0%

40%

80%

20%

60%

One year or less Over one year

A substantial

meal at least

once a day

Medical

treatment

if needed

Regular

social contact

with other

people

Medicines

prescribed

by a doctor

Dental

treatment

if needed

0%

20%

60%

70%

40%

10%

30%

50%

14%

26%

32% 33%

64%

Financial hardship has very real consequences for peoples’ physical health and their ability to afford medical care

and medicines.

A high proportion of respondents (64%) indicated they could not afford dental treatment if needed. While fewer

were unable to afford needed medical treatment (26%), it is significant that a third of respondents (33%) were

unable to afford medicines prescribed by a doctor. Fourteen per cent of respondents did not have a substantial

meal at least once a day, indicating that they were experiencing severe financial stress. All of these factors negatively

impact on physical health.

Financial stress also impacts on emotional and mental health. Not having enough money can be a very

isolating experience, causing people to curtail their social activities and lose friends as they cannot afford to go

out; about a third of our sample indicated that they could not afford regular contact with other people. The

25

My

relationships

with my

family and

iends have

improved

My

relationship

with my

children has

improved

I worry

less about

money

problems

My mental

and/or

emotional

wellbeing

has improved

My physical

health has

improved

0%

20%

60%

80%

70%

40%

10%

30%

50%

I feel more

positive

about the

future

45% 46%

52%

63%

45%

69%

consequence of this for wellbeing is that it can exacerbate feelings of stress and anxiety, which were already

very pronounced in two-thirds of our sample (fig. 15). Mental illness is exacerbated by social isolation, and 29%

of respondents indicated that they had experienced mental illness in the past year (fig. 15). Taken together, the

data confirms that financial stress has a significant and direct impact on personal health and wellbeing and

social connectedness.

Data from the outcomes section of the survey illuminates the mitigating impact which financial counselling has

on client health and wellbeing (fig. 6). Clients were asked to indicate their level of agreement (strongly agree to

strongly disagree) with a number of statements relating to financial counselling outcomes. A positive effect on

physical health was noted by 45% of respondents. Mental health and wellbeing related outcomes recorded even

higher levels of agreement: ‘I feel more positive about the future’ (69%), ‘My mental and/or emotional wellbeing

has improved’ (63%) and ‘I worry less about money problems’ (52%). This shows that financial counselling

provides measurable beneficial outcomes for client wellbeing. This was borne out in the comments section of the

questionnaire where a large number of respondents noted how much improved they felt as a result of financial

counselling and how much better they felt able to cope.

Financial counselling also impacted positively on social relationships, with 56% indicating that it had a beneficial

effect on their relationships with their children (46%) and their friends and family (45%).

When the number of stressors a person experienced (table 6) was correlated with the health outcomes of financial

counselling, data showed that people who had a higher number of stressors were less likely to record positive

health outcomes as a result of financial counselling.46 This is not surprising as people with more stressors tend to

have been in debt for a longer time, which makes it more difficult to resolve their difficulties. It also shows that

the knock-on effect of financial stress is more difficult to shift as difficult life events accrue. This underpins the

importance of understanding that seeking assistance during the early stages of financial crisis is likely to have a

greater beneficial effect.

Five key findings emerged:

including the resolution of debt related problems, advocacy, financial capability and health and wellbeing.

The survey results suggest that financial counselling is an important service that demonstrably benefits clients on

multiple dimensions of financial stress.

While financial counselling is not able to address the structural and underlying causes of financial stress, such as

inadequate incomes and the lack of suitable financial products and services, it helps mitigate immediate crisis,

providing information and education to assist people to develop longer-term financial management strategies.

Other studies have shown that many people with debt problems do not access advice services at all.47 This study

found that many people wait a long time after the onset of financial difficulties before seeking financial counselling.

Survey respondents who had been in financial difficulties for a year or less:

Financial stress is a complex problem with interlinked and sometimes mutually reinforcing causes and effects

(stressors) that can mount and worsen as time goes on, leading people to become trapped in a cycle of debt. Early

intervention is more effective in resolving debt issues and can prevent stressors from accumulating. Conversely,

people who had been in financial difficulties for longer tended to experience a higher number of stressors that

negatively impacted on their finances and their ability to resolve financial stress.

associated with financial difficulties.

Financial counselling also helped reduce the negative impact of environmental stressors, such as interpersonal

relationships and housing security, which if left unchecked may exacerbate financial stress.

and their children (46%) had improved.

27

Women are disproportionately represented in financial counselling, making up over two-thirds of respondents,

which mirrors the general client base of The Salvation Army financial counselling.

whilst the median amount of debt owed was $5,000 to $10,000.

of $20,000) compared to women, a statistically significant difference.

lasting for more than five years compared to 12% of women (12%).

The prevalent sources of debt also differed.

There could be various explanations for this. The higher number of women clients and differing debt profiles could

indicate that women are more vulnerable to debt. This study also suggests gender differences to financial stressors,

where women are likely to seek help, while men are more likely to take on more debt to pay for existing debt. It is

also possible that women are less able or willing to access further loans.

The research findings highlight the beneficial impact of financial counselling for individuals particularly in terms

of their financial capability, their health and wellbeing and in resolving or alleviating debt problems. A significant

finding is that these effects are more pronounced when help is sought sooner, rather than later.

Respondents’ comments show that attending financial counselling was a positive experience that made a difference

to their situation. Many were pleasantly surprised that they were received in a non-judgemental and understanding

way. Nearly all respondents (94%) indicated they would be more willing to seek financial help earlier in the future.

In light of these findings, it is important to consider what it is that prevents people from accessing financial

counselling. The study found that many people delay seeking financial counselling for a long time after the onset

of financial difficulties, while other studies have shown that many people with debt problems do not access advice

services at all.48 Forty-four per cent of survey respondents waited for a year or longer before accessing assistance, a

trend that was even more pronounced in those experiencing long-term financial stress, a group which represented

55% of the survey sample.

This study presents a snapshot in time only, and as such suggests the need to better understand the reasons why

people delay accessing these services and the ongoing impacts of financial counselling. The fact that many clients

experience long-term financial stress may indicate that not all of the benefits of financial counselling endure or

accrue to the same degree for all individuals.

The survey also highlights the reality of debt and financial problems for individuals and families on such

constrained incomes. Whilst financial counselling can assist to alleviate acute financial crises, it cannot solve the

broader structural issues of social and economic disadvantage that contribute to the exacerbation and impact

of financial stress.

1. To maintain and expand current financial counselling services.

2. To advocate for and continue to work towards integrating financial counselling into a holistic approach to

meeting the needs of individuals and families as demonstrated by The Salvation Army Doorways philosophy.

3. To support financial counselling as a tool for early intervention and individual capacity building within a

holistic case management approach to social and economic disadvantage, as per The Salvation Army

Doorways philosophy.

4. Address the barriers that prevent people from accessing financial counselling:

a) Develop and facilitate a communication and media strategy that promotes greater awareness of the nature,

benefits and accessibility of financial counselling services.

b) Undertake research to better understand the barriers that delay and prevent people from accessing financial

counselling services and develop strategies to overcome these. This may include different approaches for

different cohorts, for example, men and women and people in long- and short-term financial stress.

c) Undertake research to better understand the long-term impacts of financial counselling.

29

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resources/f/9/f9fc9800493e8ac695c3d7fc8cff90cd/2011-Adult-Financial-Literacy-Full.pdf.pdf?CACHEID=f9fc9800

493e8ac695c3d7fc8cff90cd>.

aboutanz/community/programs/pdf/FinancialExclusion-FinalReport.pdf>.

Centre for Social Impact, University of NSW, for National Australia Bank.

Centre, University of NSW.

commonwealth-financial-counselling-cfc, viewed 8 September 2012.

Fitch, C, Hamilton, S, Bassett, P & Davey, R (2011) ‘The relationship between personal debt and mental health:

Green, BL, McAllister, CL & Tarte, JM (2004) ‘The strengths-based practices inventory: A tool for measuring

Impact and National Australia Bank.

vol. 30, no. 4, pp. 560-71.

Institute for Social Research, University of Michigan.

Authority and Personal Finance Research Centre, University of Bristol.

London, Legal Services Commission.

vol. 53, no. 4, pp. 441-53.

St Laurence, FaHCSIA, ANZ, Smith Family, Benevolent Society and Berry Street.

Melbourne, Department of Justice.

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documents/05_2012/cdfi-scopingstudy.pdf>.

Stansfeld, S, Fuhrer, R, Shipley, M & Marmot, M (2002) ‘Psychological distress as a risk factor in coronary heart

31

Appendix 1: Survey

32

33

34

35

1 A telephone survey of 450 Magistrates Court

consumer default judgement debtors found that 67%

did not seek assistance with their debt problems

(Schetzer 2008). A report by Wesley Mission (2009)

found that only 26% of respondents sought help

after experiencing financial difficulties and that 47%

sought no help at all.

2 Australian Bureau of Statistics (ABS) data from

the General social survey 2010 shows that 19% of

adults experienced one or more cash flow problems

in 2009-10 and that sole parent households with

dependent children scored much higher than the

general population on certain indicators of financial

stress (ABS 2010).

3 FaHCSIA (2012).

4 FaHCSIA (2012).

5 ASIC (2011).

6 ANZ & Social Research Centre (2011).

7 Russell, R, Bailey, D & Wall, L (2011); Russell, R, Wall, L

& Doan, MP (2011).

8 Green, BL, McAllister, CL & Tarte, JM (2004); Kempson,

E, Collard, S & Moore, N (2005); Russell, R, Bailey, D

& Wall, L (2011); Turnell, A (2012).

9 Atkinson, A, McKay, S, Kempson, E & Collard, S (2006).

10 Connolly, C, Georgouras, M, Hems, L & Wolfson, L

(2011); Hems, L, Connolly, C & Georgouras, M (2012).

11 Hems, L, Connolly, C & Georgouras, M (2012).

12 Connolly, C, Georgouras, M, Hems, L & Wolfson, L

(2011).

13 ASIC (2011); Connolly, C & Hajaj, K (2001); Corrie, T

(2011); Russell, R, Bailey, D & Wall, L (2011).

14 Chant Link and Associates (2004); Pleasence, P,

Buck, A, Balmer, NJ & Williams, K (2007).

15 Schetzer, L (2007).

16 Nelthorpe, D & Digney, K (2011).

17 Pleasence, P, Buck, A, Balmer, NJ & Williams, K (2007).

18 Pleasence, P, Buck, A, Balmer, NJ & Williams, K (2007).

19 Kempson, E (2002); Nettleton, Burrows, England &

Seavers (1999).

20 Pleasence, P, Buck, A, Balmer, NJ & Williams, K (2007).

21 Fitch, C, Hamilton, S, Bassett, P & Davey, R (2011);

Nelthorpe, D & Digney, K (2011); Pleasence, P, Buck,

A, Balmer, NJ & Williams, K (2007); Stansfeld, Fuhrer,

Shipley & Marmot (2002); Wesley Mission (2010);

Kempson, E (2002).

22 Drentea, P (2000); Jacoby, M (2002); Reading, R

& Reynolds, S (2001).

23 Pleasence, P, Buck, A, Balmer, NJ & Williams, K (2007).

24 Nelthorpe, D & Digney, K (2011).

25 Wesley Mission (2009); Wesley Mission (2010).

26 Kalousova, L & Burgard, SA (2012).

27 Saunders, P & Wong, M (2009); Salvation Army (2012).

28 Saunders, P & Wong, M (2009).

29 The Salvation Army (2012).

30 It is difficult to accurately calculate a response rate;

1,200 surveys were sent out to financial counsellors,

nominally giving a response rate of 19%. However,

it is not clear how many were not used because

counsellors were too busy or because not enough

clients fitting the respondent profile visited the

service during the survey period.

31 Engels, B, Nissim, R & Landvogt, K (2009).

32 ABS (2011).

33 ABS (2011).

34 ACOSS (2012b).

35 ACOSS (2012a).

36 Engels, B, Nissim, R & Landvogt, K (2009).

37 Mercer Worldwide Cost of Living Survey 2012 – city

ranking http://www.mercer.com/press-releases/

cost-of-living-rankings, viewed 31 August 2012.

38 Burke, T, Stone, M & Ralston, L (2011).

39 The budget standard model is based on the work of

Saunders (1998) where a ‘low cost budget standard

represents a standard of living which may require

frugal and careful management of resources but

would still allow social and economic participation

consistent with community standards and enable

the individual to fulfil community expectations in the

workplace, at home and in the community’.

40 Burke, T, Stone, M & Ralston, L (2011).

41 ACOSS (2012b).

42 Chi-square at the 0.5.

43 Chi-square at the 0.5.

44 Chi-square at the 0.5.

45 Hems, L, Connolly, C & Georgouras, M (2012).

46 Pearson’s correlation at the 0.5.

47 A telephone survey of 450 Magistrates Court

consumer default judgement debtors found

that 67% did not seek assistance with their debt

problems (Schetzer 2008). A report by Wesley

Mission (2009) found that only 26% of respondents

sought help after experiencing financial difficulties

and that 47% sought no help at all.

48 See endnote 1

Endnotes