Inside Australia’s Cost of Living Crisis

APRIL 2026

Australians are facing new challenges as the rising cost of living impacts daily routines and household decisions.

According to the latest figures from the Australian Bureau of Statistics, rises in annual living costs ranged from 2.3% to 4.2% in the December 2025 quarter. The ABS found people were paying more for housing, food, non-alcoholic beverages and culture. Another contributor was electricity costs, which drove increases up 4%.

Many people are adjusting their spending, whether that's cutting back on groceries and essentials, postponing major purchases, or reconsidering non-essential services. Some are finding creative ways to stretch their budgets, such as stocking up on pantry staples, which helps make meals go further and provides a sense of preparedness.

Research from Relationships Australia revealed that most people named the cost of living as their number one challenge in their relationship, affecting approximately 5.6 million Australians. This was the first time the cost of living has been identified as a relationship pressure.

Concern over factors like fuel prices and interest rates is prompting practical solutions, including reviewing expenses and shopping habits. While these changes can be stressful, Australians are responding with resourcefulness and resilience, making thoughtful adjustments to manage their finances in a changing economic environment.

There’s genuine anxiety that the ongoing conflict in the Middle East will continue to have an impact. While there’s no indication we’ll see empty supermarket shelves like we did during lockdown, the message from the grocery aisles is clear: people are feeling the instability and are making sure their pantries are ready.

Strategies

This sounds like grim news, but there are some simple strategies we can implement.

Most importantly, budgeting. Creating a budget is essential for tracking how much we can afford. It also gives us a sense of control.

Another simple step is to conduct a subscription check. It's easy to forget about individual subscriptions and $10 a month might not look like much, but can add up to a lot, especially if you subscribe to multiple streaming services. Review all your subscriptions and see if they are still needed.

Thirdly, review your mortgage interest rate and ask your lender if there is any room for adjustment. If you are looking to re-finance, our lending team can assist you in finding the best arrangement for your circumstances.

Other recommendations include exploring different energy deals, buying groceries online to avoid impulse buying, prioritising things that matter, getting your debt under control and talking to financial experts.

Seek support

If you need guidance in managing your household budget and navigating the current cost of living, reach out to us, we’re here to support you.

Advice Disclaimer: This article is intended to be general in nature and is not personal financial product advice. It does not take into account your objectives, financial situation or needs. Before acting on any information, you should consider the appropriateness of the information provided and the nature of the relevant financial product having regard to your objectives, financial situation and needs. In particular, you should seek independent financial advice and read the relevant product disclosure statement (PDS) or other offer document prior to making an investment decision in relation to a financial product (including a decision about whether to acquire or continue to hold).