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A FIFTH STILL IN DEBT AFTER LAST CHRISTMAS

A survey carried out on behalf of Circle Housing has found that around one million people in the United Kingdom are still paying for Christmas 2013, twelve months on at Christmas 2014. The staggering figure comes as projections suggest six million people will look to take out a loan to cover the festive period.

The aftermath of a joyous Christmas in 2013 is becoming clearer; we’ve previously blogged about those that were still struggling with debt into the summer months, however new research has found that the debt is still hitting some of the worst off. This is of huge concern, considering we are now at Christmas 2014 and a million people haven’t managed to pay off last year’s Christmas. This could lead to a vicious cycle, as debt is beginning to accrue for 2014 the total amount owed by an individual is rising.

Darker still, the survey found that households aren’t just turning to credit in order to enjoy the festive period. Three million adults are looking to sell or pawn their possessions in order to reduce their Christmas debts, this could include items they were gifted in 2013.

Some feel the introduction of hyper focused sales events such as Black Friday have led to an increase in spending: Matt Earnshaw, Group Financial Inclusion Manager for Circle Housing, said: “Many of us got swept up by the frenzy of activity during Black Friday and Cyber Monday, and the pressure on us to spend more money is only likely to heighten.” The problem is that this event is targeted and accessible to everyone, even those without the means to afford it are encouraged to consume during the time sensitive sales.

Matt Earnshaw goes on to encourage those who have been affected to seek support “Facing up to debt can be a frightening prospect if people don’t know where to get help – we urge anybody who is worried about managing their money to get help right away and deal with the debt quickly.” The effects of Christmas 2014 won’t be clear until the New Year however the research found that based on research and stats for 2013:

Christmas Borrowing

  • One in twenty borrower’s state that they will turn to payday lenders for help this Christmas.
  • A quarter of British adults said that they plan on spending less this Christmas compared to last year.
  • More than three quarters of British adults expect to spend up to an extra £1,000 over the festive period.

Whilst it is encouraging to see that people are planning to spend less, the fact that payday lenders are still being considered as a way to access funds for Christmas spending shows some are still trying to spend above their means.

You may also benefit from reading our Christmas Savings Blog, or Big Budgeting Blog for 2015.

If you are struggling with debt issues, whether these are business or personal debts, The Debt Advisor Ltd which incorporates The Business Debt Advisor can help.  There are a range of solutions available which include both formal and informal solutions such as Debt Management Plans (DMP)Individual Voluntary Arrangements (IVA),  Bankruptcy as well as solutions for Businesses.

There is also free debt help and advice available through a variety of debt charities. For more information, we recommend you visit www.moneyadviceservice.org.uk.

The Debt Advisor is regulated by The Financial Conduct Authority and is also a member of the DRF and we adhere to their codes and standards.

Call us today on 0800 0851 825 to speak with one of our advisors. If you’re calling from a mobile you can reach us on 0333 9999 600.

A FIFTH STILL IN DEBT AFTER LAST CHRISTMAS

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