NEW research has shown that approximately one in five Brits will still be paying off their Christmas debt at Easter.
Credit management company Lowell conducted research into the impact the festive season has had on UK household finances between 2021, 2022 and going into 2023.
Lowell found that in 2021, the average British adult spent £548 on presents alone, and that 55% more Brits felt the pressure to buy extra in 2022.
Now, almost one in five (17%) Brits have said it will take until Easter to pay off their Christmas debt.
This means that a third of the year will be spent paying back what was spent over the festive period, with a further 21% taking two months to clear their debt.
Furthermore, 18% of Brits said their debt could have reached at least £600 at Christmas, and one in 10 even claimed that they expected to spend £1,000, not including any late fees or additional interest accrued on balances carried past the due date.
34% of people in the UK also anticipated that they bought more than they needed, a 55% increase since 2021.
More than a quarter (28%) expected to spend beyond their budget, and 18% felt under pressure to buy more expensive luxury items despite inflating costs.
The impact of social media also added a strain to people’s buying habits, with 15% more Brits overstretching themselves financially to buy premium brands compared to 2021.
Plus, one in 10 admitted to feeling pressure from Facebook, Instagram and TikTok to keep up with new trends.
Christmas can be a financial worry for many, with a quarter of Brits claiming they had to cut back as much spending as possible due to the cost-of-living crisis.
Furthermore, 25% of people were concerned that they wouldn’t be able to heat their homes amid rising energy bills, and 14% put up fewer Christmas lights as a way to keep costs down.
In 2022, there was a 47% increase in credit cards being used as the main funding source for Christmas.
More than half (51%) dipped into savings, and one in ten opted for Buy Now Pay Later schemes.
Encouragingly, 40% more Brits relied on their disposable income, instead of outsourcing other finances.
John Pears, UK Managing Director of Lowell UK said: “At Lowell, we understand that with so many financial outgoings Christmas can be an expensive time for many people.
“The cost-of-living crisis is having a huge impact on many households – and we fear this will get worse if people felt under pressure to overspend during the festive period.
“Our report shows an increase in the number of people that intended to use credit to fund Christmas.
“This can cause an increase in household debt that can become difficult to manage.
“We’d like to remind anyone feeling financial pressure to reach out for support, and a list of organisations who can help can be seen at https://www.lowell.co.uk/help-and-support/independent-support/”
