Christmas is seen as a jolly time of year but with the cost-of-living crisis impacting the entire UK along with rising energy bills, we understand that the financial pressure of Christmas this year is going to be tough.
We actually did a similar study last year on Christmas debt which revealed that the average person in the UK gets into £439 of debt over the festive period along with the other financial pressure Brits were facing. But just how have things changed in the last 12 months for Christmas 2022?
Last year, we discovered that the average Brit was going to face being £439 in debt after all the Christmas spending. This year, our research reveals that over half of respondents (55%) expect to accumulate some debt over Christmas with one in 10 (10%) believing their debt might reach at least £1,000! Not only that, but 17% of Brits predict it will take three to four months to recover from their Christmas spending.
In fact, other research from Finder1 estimates that the cost of Christmas this year could reach a whopping £1,130 per household if the inflation rate reaches 13.3% in October, as predicted by the Bank of England.
Christmas is always a tricky time of year when it comes to managing your finances as you’ve got so much to think about including decorations, festive food and snacks, as well as any presents you’re giving out.
We asked Brits whether they feel any pressure to buy more than is needed and 34% of people said they do, which is up from just 22% last year. But where is this money coming from?
According to our research, over half of Brits (51%) are planning to dip into their saving to fund their 2022 Christmas, an increase from 39% who felt the same last year. However, a quarter (25%) said they’ve thought about using their credit cards with 12% considering buy now pay later agreements.
It’s clear that Christmas is an expensive time of year, but it’s important to not spend more than you can afford, or at least can afford to pay back. While you might not think it’s an issue to depend on credit now, this could lead to problem debt if you can’t keep up with payments and impact your credit score. To find out more, you can read our blog on how your credit file affects you.
Circumstances, particularly concerns regarding finances, have changed considerably in the last 12 months and this has had an impact on many Brits. A quarter of Brits (25%) admitted that the cost-of-living crisis has meant that they’ll have to cut back this Christmas. Rising energy bills are also a concern with 25% of people feeling the pressure about being able to keep the house heated, and 14% are concerned about leaving their Christmas lights on.
For top tips on how you can save money this Christmas including making your own decorations, spending less on Christmas dinner and more, be sure to read last year’s blog on how to budget for Christmas.
At Lowell, we know and understand that you might be worried about your debt this Christmas, but there’s always help available. If you’re a customer of Lowell, please get in touch with our friendly and supportive team who are always here to listen and find the best option for you.
Published by Stephanie North-Shaw on 30th November, 2022
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We surveyed Brits to find out what kind of pressures we face to create the ‘perfect’ Christmas, and the impact this can have on our finances.
Discover our top tips for a budget-friendly Christmas, from upcycled woodland decorations to low-cost present ideas.
There are lots of ways that Lowell can offer you additional support with your debt. Find out how we can help you today.