Australians slashing debt, saving cash, St George-Melbourne Institute report says Taking action ... Australians are taking a proactive approach and stashing money while cutting down their debt levels. Source: Thinkstock. AUSTRALIANS are cutting down their debts and saving more money as they optimise record low interest rates and build up their cash buffers. The number of households running into debt and drawing on their savings is at its lowest point in nine months and bank deposits remain the most popular form of saving. Smart savers ... fewer households are running into debt. The latest St. George-Melbourne Institute Household Financial Conditions Report released today showed savings for holidays (61 per cent) and being prepared for a rainy day (57 per cent) were the key drivers for Australians to stash cash. Wise move... many Australians are cutting down their debts and saving cash for a holiday. PAYMENTS: Bank customers want better facilities to help manage money The report which surveyed 1200 Australians showed the number of households dipping into their savings or running into debt fell from 22 per cent to 17 per cent in the September quarter. St George senior economist Hans Kunnen said the Reserve Bank of Australia's decision to keep the cash rate on hold at 2.5 per cent since August last year allowed people to scale ahead on their home loan repayments and squirrel more cash. Think smart ... St George senior economist Hans Kunnen says Australians need to keep their spending under control. SAVVY: Australian consumers are saving more money "The low interest rate environment has allowed people to pay a little less on their mortgages and get a buffer and pay down some of the expensive debt they prefer not to have,"" he said. Borrowing for reasonable income-earning assets is not a bad thing but too much personal debt is clearly a bad thing if you are racking up six credit cards then you need to talk to somebody. We are saving for Christmas rather than crediting for Christmas and people are going to be more cautious about adding to their debts. Being jolly ... Australians are already saving for the festive season. In the Reserve Bank of Australia recent biannual Stability Review, it was revealed that Australians were on average two years ahead of their mortgage repayments. The report said the huge ground had been gained because some banks had not automatically changed customers repayment amounts when rates had fallen and "in many cases households have not actively sought to reduce their repayments." Originally published as Savvy Aussies slash debts, save cash