Grocery prices consumers’ biggest financial concern

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Of the 18,000 people surveyed 70 percent said there had been no let up in the financial pressures they had felt over the last 12 months.
Photo: 123RF

Consumers are most worried about the cost of groceries, which is adding to the financial pressure many are feeling.

The third annual Consumer Pulse survey by research firm Canstar indicates consumers were feeling intense financial pressure as they prepared for another tough year ahead.

Canstar New Zealand content & editorial manager Bruce Pitchers said the report reflects the intense pressures households were under, with women more pessimistic about the outlook than men.

“What we found over the last 12 months is just pessimism people have had about the state of their finances and the economy,” he said.

“We’ve had like 70 percent of people, over the past 12 months, say that it’s just been so tough and there’s been no let up in financial pressures they’ve felt.”

Only 25 percent of the many thousand surveyed (18,000) said they were coping with rising costs by cutting personal costs, though 40 percent of those described themselves as higher income earners.

Still, half of homeowners had cut back on non-essential spending such as eating out, entertainment and fashion.

More than a third of homeowners had recently refixed their mortgages, which had resulted in between a 30 and 50 percent increase in repayments.

Another 9 percent said their repayments went up by more than 50 percent.

However, grocery prices were the biggest financial concern with 28 percent of consumers putting food ahead of rent and mortgage costs.

“It’s food prices have really hammered people – just everyday products – the price is going through the roof. There’s no let up for that,” Pitchers said.

About 20 percent had been cutting back on essential items, such as groceries, electricity and phone usage.

When it came to retirement, the average consumer expected to need just over $470,000 for retirement, but less than a third (29 percent) felt they were on track to achieve their goal.