New research from insurance brand Youi has revealed a growing financial divide among Australians, with Baby Boomers increasingly feeling left behind by the cost-of-living crisis and worried about their position in an evolving economic climate.
According to a nationally represented survey of 2,000 Australians conducted last month, nearly half of Baby Boomers (49%) believe their financial situation has worsened over the past two years – the highest proportion of any generation – while managing daily expenses such as groceries and utilities is a top concern.
Unexpected bills remain a significant worry for 23%, despite older Australians reporting they can comfortably afford an average unexpected cost of $3,960.30.
In response to rising expenses, Boomers are demonstrating a willingness to adjust spending habits, with 38% prepared to cut back on eating out and takeaway more than younger generations. Reducing expenses is the primary financial goal for 28% of Baby Boomers.
The findings form part of broader national research indicating financial pressure is widespread.
According to the survey, more than two in five Australians (42%) say their financial situation has deteriorated over the past two years, while two thirds (66%) admit they are only just scraping by, struggling with debt, and would struggle if hit with an unexpected cost.
The research comes as Youi launches a new Financial Fitness Calculator – designed to help Aussies of all ages work towards their financial goals in 2026.
Cost-of-living pressures continue to weigh heavily on households; with 62% reporting they feel the financial squeeze daily or most days. Financial stress has also affected wellbeing, with 34% saying it has negatively impacted their mental health and 26% their physical health.
Conversely, nearly one third of Australians (30%) say their finances have improved, largely due to tighter budgeting and reducing non-essential spending such as dining out and entertainment. However, monthly bills (47%), grocery costs (44%), and the growing need to dip into savings (31%) remain key stressors.
Youi Chief Customer Officer Anthony Antonucci said Australia’s intentions are clear for the year ahead, that being to get finances into better shape.
“Aussies are under real pressure, but we’re seeing a shift from reacting to costs to protecting what matters most,” Antonucci said.
“Our research shows that almost 80% of Australians review their insurance spending annually, which is a great start, but far fewer, less than 40%, say they are likely to review or switch their insurance provider in the next 12 months. Many could be missing savings simply by not shopping around or comparing their options.
“With budget pressures impacting most households, affordability without compromising on your cover should be a priority. Take a look closely at your policy and make sure your insurance still fits your needs and budget,” he said.
The research suggests rising everyday expenses, rather than discretionary spending, are the primary driver of financial stress. About 91% of respondents cited increased costs for essentials such as groceries and fuel as a key contributor, followed by unexpected bills (58%) and higher household costs like childcare (37%). The findings align with the latest ABS Consumer Pricing Index, which lists housing (+5.5%), food (+3.4%), and recreation (+4.4%) among the largest contributors to annual inflation.
Financial strain is also influencing lifestyle factors, with more than one in three Australians reporting impacts on sleep (35%), social life (33%), and nutrition (25%).
Confidence in external support appears divided, with nearly six in 10 (59%) believing governments should be doing more to support households, while a third (33%) say individuals must take primary responsibility for their financial security.
Long-term aspirations are also shifting. Almost half of respondents (46%) believe they may never be able to afford a home, with a further 11% saying home ownership is unlikely within the next decade. Only 5% feel confident they could purchase a home in 2026.
Economic Futurist and Behavioural Economist, Evan Lucas said financial pressure is reshaping how Australians think about money and wellbeing.
“Households are under strain, but they’re becoming more deliberate and vigilant with their money to protect what matters most,” Lucas said.
“The key to staying on top of your money is to know where it’s going – turn your reviews of fixed costs like phone, energy and internet, into a regular habit. Exercising discipline here can help identify potential areas of savings.
“Oftentimes people sign up for a service, and neglect to check whether there are cheaper options out there, a mistake that could be costing you. Moving away from ‘set and forget’ and regularly reviewing fixed costs is one of the simplest ways to build financial strength.
Lucas outlined several practical steps Australians can take immediately, including scheduling regular reviews of bills and subscriptions, automating savings, prioritising debt repayment, and using online tools to track spending and identify savings opportunities.