New Report Shows Christmas Leading To More Debt Than Ever Before

Top Quote A FinancialFacts investigation shows that people are more willing than ever to set aside good financial commonsense for the holidays. End Quote
  • (1888PressRelease) January 01, 2010 - FinancialFacts reports on a disturbing trend that is devastating household budgets: Christmas shopping. While December is traditionally difficult on family finances, with credit-card spending rising exponentially, approximately one in ten people have gone into debt while handling the cost of the holiday season.

    This cultural habit of devoting large sums of cash for a single brief period of pleasure has become increasingly common. The cost of weddings is rising sharply as young women have become increasingly determined to have a ceremony that combines the lavish excesses of Disney fantasy and WAG ephemera. In order to have access to these necessary funds, people are becoming more and more reliant on credit cards.

    In some situations, utilising credit cards can make excellent financial sense. For example, rewards credit cards, as offered by companies like MBNA, offer rewards points for every purchase made, effectively given you cash back on your necessary spending. However, if you have no means to making the repayments, this otherwise sound strategy can backfire, pushing you further away from financial stability.

    FinancialFacts, working with data provided by R3 insolvency trade body, has found that the pernicious side-effects of holiday debt can last for a long time, as 6% of people are still repaying money taken out for presents from the previous Christmas! Even more worryingly, 13% of respondents felt they would be unable to cover the cost of their regular bills because of seasonal overindulgence!

    While credit card debt is obviously best avoided, it is still preferable to seeking out loans or relying on friends and family - which is what 8% of shoppers did this Christmas.

    Pressure to host an astonishing Christmas spread weighs heavy on everyone each year and while disappointing family members is obviously best avoided, FinancialFacts suggests that being willing to cut out unnecessary spending will ultimately offer the best care for your family in the long-run.

    FinancialFacts has found that statistics suggest a record 154,355 people will be declared insolvent during 2010 - and, ultimately, a Christmas without the snazziest crackers will be worth it if it can help avoid such severe financial tragedy.

  • FB Icon Twitter Icon In-Icon
Contact Information