How are you handling the cost of living? Some of the top-rated personal loans in November 2024

Australia’s cost of living is still rising, but more slowly than previously, according to the latest data from the Australian Bureau of Statistics (ABS). But should Australians use personal loans to help them manage?

According to the ABS September 2024 Selected Living Cost Indexes, employee households experienced their smallest quarterly increase in living costs since the September 2021 quarter. Meanwhile, living costs for the remaining household types rose by the smallest amount since 2020.

ABS head of prices statistics, Michelle Marquardt, said that employee households have been bearing the brunt of the cost of living compared to other households largely due to rising mortgage interest charges. While the RBA hasn’t increased the cash rate over the past 12 months, mortgages have continued to go over the fixed rate mortgage cliff and revert to higher variable rates.

So, how have Australians been managing these higher household costs? According to the latest Lending Indictors report for September 2024, the value of new loan commitments for total fixed term personal finance rose 2.1% to $2.8 billion and was 16.1% higher compared to a year ago. This could indicate that more Australians are turning to personal loans to help navigate the cost of living.

That said, statistics from credit bureau Equifax tell a different story. According to its Quarterly Consumer Credit Insights for September 2024, unsecured consumer credit applications declined -1.9% compared to the same quarter last year. This included personal loan applications, which fell -6.7% compared to the September quarter 2023.

Equifax general manager advisory and solutions, Kevin James, said that Australians reducing their reliance on unsecured credit suggests that they are adjusting to the challenging economic climate, with arrears also decreasing compared to the last quarter.

“That said, consumers aren’t entirely out of the woods - mortgage and personal loans arrears of 90+ days past due have edged up compared to last year.”

Sometimes a personal loan can help to manage your household budget, such as when you’re consolidating other debts. However, it’s important to carefully consider your finances and make some calculations first, as the longer you’re in debt, the more interest you may need to pay.  You may want to consider contacting a financial adviser, or if you’re under financial stress, a free financial counsellor.

It's important to compare personal loans before selecting an option that suits your needs. RateCity’s Real Time Ratings™ combine the cost and flexibility of different personal loan options to help you get a better idea of their overall value. Personal loans are also ranked on RateCity’s Personal Loan Leaderboards to further simplify your comparison.

(Rankings are correct at the time of publishing. Please note lenders may trade places on the list as interest rates and fees change and RateCity’s tracker reflects these movements.)

Some of the top-rated excellent credit personal loans

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