Following a once-in-a-lifetime health pandemic and a similarly once-in-a-lifetime, albeit shorter, recession, Australians overall financial wellbeing has actually improved substantially – with the latest Commbank financial wellbeing report finding the index rose 7.8 per cent to a record score of 51.1.

This represents the largest year-on-year increase since the score begun being calculated in 2017, and is largely due to cautious consumerism and a focus on saving, rather than spending, during the pandemic.

“While clearly there are people struggling or worse off from the pandemic, more Australians feel better off, more financially secure and more in control of their finances,” said CBA executive manager of financial wellbeing Ben Grauer.

“Spending less, saving more and paying down debt have been the big stories from this past year.”

And the increased financial flexibility is likely to lead to higher sales in retail, Commbank revealed. In its recent Houshold Spending Intentions series, intentions to spend in retail jumped sharply in April after facing a decline in March, and landed higher than April 2020 and April 2019.

“This comes as no surprise as we know that April 2020 was the low-point for spending as the first wave of Covid-19 restrictions hit Australians,” said CBA chief economist Stephen Halmarick.

“A year later, the economy has recovered strongly from Covid-19 impacts, with employment above pre-pandemic levels and household spending intentions on the rise as consumers once again feel confident about their economic prospects.”