The most charitable suburbs in Australia

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It’s been a tough period for Australian household finances over the past year.

Mortgage rates have increased for many families, wage growth remains weak, and going backwards for those in the private sector, while gas and utility prices have spiked, placing further pressure on already stretched household budgets.

There are signs that households are cutting back spending in discretionary areas, especially in recent months.

On those metrics at least, it’s been a difficult period even with a strong run of employment growth.

However, despite those challenges, Australians still remain a charitable bunch with donations lifting modestly in the 12 months to August this year.

According to the National Australia Bank’s (NAB) Charitable Giving Index, donations increased by 1.4% over this period, taking the increase from 2010 to 37%.

The average donation size now stands at $355 per donor.

By age group, donations from Australians aged 55 years and older grew at a faster pace than the national average, while those aged 34 years and younger continued to decline, maintaining the trend seen over the past few years.

Source: NAB

By state, donations in South Australia grew at a faster pace than other parts of the country. Western Australia and the Northern Territory, areas recovering following the slump in commodity prices and investment in prior years, continued to lag the national average even though the decline in donation levels slowed.

Source: NAB

The most charitable suburb in donation size was Woollahra in New South Wales, edging out Cremorne (NSW) and Toorak (VIC) for top spot during the year.

Source: NAB

“The 20 most postcodes are typically high income areas, enjoying an average income of around $120,000, double the national average of just under $60,000,” the NAB says.

These figures are derived as the average donation per person per suburb.

As a percentage of taxable income, the most generous suburbs in Australia were Fitzroy North in Victoria and Sturt in South Australia allocating 0.4% of income to charitable purposes.

Source: NAB

Looking ahead, Alan Oster, chief economist at the NAB, says that charitable giving will likely face challenges from cost of living pressures.

“Donors face headwinds from high household debt levels, slow wages growth and high utility prices, all of which may impact their desire to spend,” he says.

“But as wages growth slowly inches up and unemployment improves, we hope to see further growth in charitable donations.”

The index is produced by Quantium and includes donations via credit card, direct debit, BPAY and EFTPOS, but not from cash or direct transfers from bank accounts.

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