As the economic landscape in Australia continues to shift, more households are experiencing a phenomenon dubbed ‘agency by necessity.’ Faced with persistent cost-of-living pressures, housing affordability challenges, and tighter lending conditions, Australians in 2025 are stepping up and taking charge of their financial futures—not by choice, but by urgent need. This is not about waiting for policy makers to step in. It’s about everyday people becoming the agents of their own change, sometimes in unexpected and creative ways.
What Is ‘Agency by Necessity’?
‘Agency by necessity’ describes the collective mindset shift occurring as Australians find themselves compelled to adopt proactive financial behaviours in response to external pressures. Rather than passively enduring economic headwinds, people are:
- Re-evaluating their spending habits
- Exploring alternative income streams
- Negotiating harder with lenders and landlords
- Collaborating within communities to share resources
This trend is not just anecdotal—recent research from the Australian Bureau of Statistics shows a significant rise in side hustles, refinancing activity, and peer-to-peer resource sharing since late 2023. As inflation has proven stubborn and real wages have lagged, the ‘wait and see’ approach is being replaced by a ‘make it happen’ attitude.
Real-World Examples of Financial Agency in Action
Consider the story of Tash, a Melbourne-based teacher who saw her rent increase by 12% in early 2025. Instead of moving to a cheaper suburb, she joined a local housing co-op, splitting bills and sharing food costs with three other families. This not only eased her financial burden but also created a support network during turbulent times.
In Brisbane, software developer Josh faced mounting mortgage repayments after the RBA’s February 2025 rate hike. He leveraged new digital platforms to start freelance coding in the evenings, using the extra income to pay down his variable-rate loan faster. With the Australian Taxation Office updating its guidance on side income reporting this year, Josh was able to navigate compliance with confidence.
Other examples seen across the country include:
- Households bulk-buying groceries and splitting costs through neighbourhood WhatsApp groups
- Parents swapping child-minding duties to save on daycare expenses
- Young adults moving back in with family or forming multi-generational households to share rent and utility costs
- Individuals using salary sacrifice and superannuation contribution strategies to maximise tax efficiency, in light of the 2025 federal super reforms
Policy Shifts and the Evolving Financial Landscape in 2025
Several 2025 policy changes are nudging, and sometimes forcing, Australians toward greater financial agency:
- RBA Interest Rate Stance: The Reserve Bank’s reluctance to cut rates until inflation tracks closer to its 2–3% target has kept borrowing costs elevated. This is prompting both homeowners and renters to re-examine their budgets and seek new income sources.
- Superannuation Changes: The federal government’s 2025 reforms, including increased contribution caps and new rules for first-home buyers accessing super, have led to a surge in financial advice-seeking and DIY investing.
- Cost-of-Living Relief: While targeted government relief packages (e.g., energy rebates, expanded rent assistance) offer some respite, the application processes are driving more people to engage with their finances and understand eligibility criteria closely.
- Digital Finance Tools: The rise of budgeting apps, investment platforms, and open banking tools is empowering Australians to track and optimise their money more easily than ever before.
Collectively, these changes are catalysing a new era where financial literacy and agency are no longer optional extras—they’re survival skills.
Practical Ways to Embrace Agency by Necessity
If you’re feeling the pinch in 2025, consider these steps to take control:
- Audit Your Finances: Use digital tools or a simple spreadsheet to map your income, expenses, debts, and savings.
- Negotiate Everything: From insurance premiums to subscription services, don’t accept the first offer—many providers are open to renegotiation in the current climate.
- Explore New Income Streams: The gig economy is booming. Whether it’s tutoring, ridesharing, or selling crafts online, extra income can make a real difference.
- Lean on Community: Don’t underestimate the power of sharing resources, swapping skills, or pooling purchases with neighbours and friends.
- Stay Informed: Keep up with policy updates—eligibility for rebates, superannuation tweaks, and tax deductions can all shift year to year.
Conclusion: A New Era of Financial Self-Determination
Agency by necessity may be born out of tough times, but it’s fostering a resilient, resourceful, and empowered generation of Australians. By taking control—sometimes out of sheer necessity—people are not only weathering today’s economic storm but also building habits and networks that will serve them well into the future. The challenge is real, but so is the opportunity to shape your own financial destiny.
