Nearly a quarter of UK adults (23%) – 11.6 million people – are still struggling with last Christmas’ financial hangover, according to new research conducted on behalf of Debt Advisory Centre*. The average outstanding debt is £517 – suggesting that £6 billion borrowed last Christmas is still outstanding.
Overall, 46% of people say that they borrowed money to help pay for last Christmas. Half of them say that they have now cleared the debt. But, with less than 6 weeks to go until the festive season, last Christmas’ debt is still hanging over millions of people. Of those that borrowed money last Christmas and still haven’t cleared it, 1 in 5 say that they still owe more than £1,000. People under 35 are the most likely to have borrowed money to pay for Christmas 2015 – with 52% of 18-24s and 59% of 25-34s saying that they did so. They are also the least likely age groups to have paid off last year’s borrowing with a third (24% and 36% respectively) saying that they have yet to clear their balance.
By contrast, 64% of people over 55 say that they didn’t borrow money last Christmas. It seems that many of us are being less than honest about the state of our finances: whilst almost half of adults say that they borrowed money last Christmas, just 13% claim that they will need to do so this year.
Debt Expert, Melanie Taylor at Debt Advisory Centre says: “For the millions with little or no savings and who are just making ends meet month to month, there is little choice but to borrow if they want to buy presents and other Christmas treats. Many of these people have no slack in their budget, so finding money to make the repayments in the New Year will be a struggle. It is no surprise that January and February is the busiest time for many debt advice providers.”
The main finding of the report:
- 23% of Brits are still repaying money they borrowed last Christmas
- 1 in 5 of those owe over £1,000 to their lenders
- 13% of say they will borrow money to pay for Christmas this year