Australians are becoming increasingly strategic about their retail spending

Four in 10 had delayed their purchases until major sales events last year.

Grocery costs emerged as the biggest strain on household budgets. (Source: Helena Lopes via Pexels) 

Australians are becoming more strategic about their retail spending as cost-of-living pressures hit, according to new research.

Findings from Experian’s Spend Index Report reveal that only 33 per cent of consumers surveyed feel optimistic about their household finances this year, with more than three-quarters (77 per cent) of Australians reporting changes to their financial behaviour.  

Against that backdrop, four in 10 had delayed their purchases until major sales events last year, while nearly 60 per cent reduced shopping and retail spending amid tighter budgets and rising financial pressure.

The cutbacks were particularly on eating out (72 per cent), followed by takeaway (61 per cent), shopping and retail purchases (57 per cent), and domestic travel and holidays (39 per cent), as consumers shifted towards lower-cost and home-based activities.

The survey found that the cost squeeze is extending beyond discretionary spending, with grocery costs emerging as the biggest strain on household budgets. Thirty-four per cent of Australians surveyed said grocery costs had risen the most over the past year, while more than half (52 per cent) dipped into their savings to manage rising expenses.

Such growing consumer caution caused the recovery in household spending to lose momentum at the end of last year.

Experian’s data also pointed to a shift in consumers’ payment habits, where more than one-third (36 per cent) of Australians relied on credit to cover everyday or essential expenses. Buy Now, Pay Later (BNPL) spending also increased 16 per cent in 2025, reflecting how flexible payment options have become part of household budget management.

Barrett Hasseldine, head of data science at Experian Australia and New Zealand, said, “Rather than pulling back spending entirely, many households are reprioritising where money goes and using a mix of savings, spending choices and flexible payment options to manage cash flow.

“In this environment, a more current view of customer circumstances and portfolio health is critical, helping organisations identify emerging pressure earlier, engage customers with greater empathy and make more informed decisions as conditions change.”