Average aussie $1,100 richer

Published in Herald Sun, March 2010 by Karina Barrymore

Australians are clawing back the wealth they lost in the global financial crisis.

The average person was $1100 richer during the December quarter, figures show.

Net personal financial wealth stood at $46,000 per person, up almost 1 per cent over the three months.

But it was still 20 per cent below the 2007 peak before the financial meltdown.

The Australian Bureau of Statistics figures measure financial assets such as bank deposits and superannuation, as well as other investments such as shares, minus any borrowings used to purchase these investments.

It does not include housing or property values.

"Australian households have plenty to cheer about, with wealth levels repairing further in the December quarter," CommSec economist Savanth Sebastian said.

"Financial wealth now stands at the highest levels in almost two years," he said.

The pick-up is expected to continue as the recovery in the stock exchange continues.

But the improvement was expected to remain modest in the immediate future, Mr Sebastian said.

Wealth Within founder Dale Gillham said the data showed people were still borrowing at a high level, but this was hidden by rising investment values.

"We've obviously had a boom recovery in the sharemarket during the past 12 months, and it is expected to rise further," Mr Gillham said.

"But what alarms me is that we still have record high debt levels. People are still borrowing to get into shares but because the market is moving up, it is actually covering up the borrowing mistakes.

"The sharemarket is growing at four times the rate it was a year ago but that's not going to last," he said.