New YouGov polling commissioned by StepChange Debt Charity, which explores people’s finances and borrowing habits, reveals that over two in five people (41%) in Wales, equivalent to 1m people, will struggle to afford Christmas this year.
Across Britain, one in four people (24%) will struggle to afford Christmas, showing just how tough the Christmas period for some people in Wales will be.
The survey also reveals that in Wales:
- When compared with 2022 figures, this marks an increase of 17 percentage points
- One in ten (10%) of people will turn to credit to afford Christmas
- 4% of people are still paying off their Christmas debt from last year.
Across the whole of Great Britain, those who are relying on credit to fund their Christmas this year overwhelmingly say this is due to the higher cost of living, with three in four citing this (75%) as their reason for needing to borrow.
StepChange has seen first-hand the impact that two years of cost-of-living pressures have had on household budgets, as the number of people going through debt advice at the charity has risen by more than 10% year on year. Whilst inflation may have slowed, prices for everyday goods remain much higher than they were just a couple of years ago and finances will still be stretched this festive season for many.
The New Year can be a daunting time financially as people may emerge from the festivities with a debt hangover. For StepChange, January 2023 was the busiest month for more than two years, with the charity seeing a 32% rise in demand compared to the previous January. The charity is urging people to reach out for support if they’re worried about their finances this Christmas – don’t wait, act.
Vikki Brownridge, CEO at StepChange Debt Charity, said:
“People understandably feel pressured around Christmas time to spend money to create special moments and memories with their loved ones. However, this pressure can often encourage people to spend more than they can afford, and turn to credit to cover these costs.
“Against a backdrop of almost two years of high inflation, it’s very likely that relying too heavily on credit at Christmas could lead to debt problems in the New Year. At StepChange, we see some of our busiest days during January each year, with last January being our busiest month for several years.
“We would urge those who are thinking about borrowing to cover festive costs to always carefully consider whether those credit repayments will be comfortably affordable when the New Year comes around. Many adverts around this time of year imply that spending is the way to create a happy Christmas, but in reality, people would prefer their loved ones to be free from financial worries and problem debt. If you are struggling with debt now or in January and beyond, it’s never too soon to reach out for help. Free debt advice and support is available from charities like StepChange.”
StepChange has shared its top three tips for people worried about their finances this festive season, and what to keep in mind when Christmas shopping:
- Go through your budget to look at what you can realistically afford to spend over the festive period. This is a really helpful way to identify how much money you have spare to go towards Christmas planning. StepChange has a step-by-step guide to help you create a budget and create a clearer picture of your finances.
- Keep your eye out for deals or offers on items you know you want to buy this Christmas, but don’t get drawn into buying things you didn’t need in the first place – a deal is only a deal if you were going to buy it anyway. Making a list in advance of your Christmas shopping may help you to stick to it and prevent you from buying extras you may not need.
- Think carefully before you borrow money – try not to get drawn into short-term high cost credit, or options to buy now and pay later if it’s not affordable. If it’s going to take many months to repay what you borrow to pay for Christmas, it’s worth pausing for a moment to think about whether your friends and family would really want you to suffer financially as a result of your generosity.
Free, confidential debt advice is available 24/7 using StepChange’s online debt advice service at www.stepchange.org
