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Consumer and Debt Management Articles
Cocooning – Savings as Security in Times of Economic Uncertainty
In this report, Alan Shields discusses the study done by research firm Retail Finance Intelligent into the changes in saving behaviour among consumers since mid-2008, using economic data and the results of The Australian Savings and Deposits Council (ASDC) savings surveys. The report aims to understand past and current consumer behaviour and suggest possible future outcomes. Specifically, it focuses on the idea that consumers are “cocooning” – increasing their savings and reducing their debt in order to protect themselves against the possibility of unemployment or other adverse financial circumstances. Shields describes the consumer savings patterns in times of financial uncertainty and what strategies are adopted and which products become more attractive.
Easy Access to Information Is Good, Trusted Information Is Better
Dean Rushton writes about the findings of the independent consumer research into the behaviours and motivations of homebuyers in the market. The study was commissioned by Loan Market last year and included focus groups made up of first home buyers, first time investors, second and third home buyers, buyers who had used a mortgage broker, as well as those who had gone directly through a financial institution and never consulted with a mortgage broker. The results speak of the changed landscape of communication due to the proliferation of online tools and social networking sites. Technology means consumers have access to just about any information they need, but surprisingly, brokers are not rendered redundant. According to the study, access to information has improved greatly but trusted advisers will always play a critical role since most consumers still feel they lack the knowledge to make the final purchase decision. Rushton writes about the relationship between banks, brokers and borrowers and how this will continue to evolve into a more integrated partnership in the future.
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