During an average month 58% of consumers fund their living costs from salaries alone, meaning that they need to find ways to supplement their finances from elsewhere, but this is heightened in January.
Nearing half (46%) of consumers will dip into their savings in January, while applications for a bank loan will double compared to an average month, rising to 6% in January. Additionally, those reaching out to payday lenders rise to 9% in January, compared to 5% during an average month.
An average of 46% of consumers will dip into an overdraft in January to help see through the end of the month, while 33% of 18 – 24 year olds will reach out to family and friends to borrow money in order to make ends meet for the remainder of the month. Those living in North England are the most likely to use an overdraft facility (47%), which compares to just 33% of Scottish consumers, the least likely region to use the facility.
Finding a way to supplement salaries is a necessity for many in January. Those who say they need to enhance their finances by £300 - £499 this month more than triples to 10%, compared to 3% during an average month. Those needing to supplement their income by £500 - £999 doubles from 4% to 8%, while those who need over £1,000 to help their living costs rise by a percentage point to 2% compared to the rest of the year.
Philip Robinson, director of current accounts at Lloyds Bank, said: "Christmas is an expensive time of year, the financial toll the festive season takes can be considerable.
“At this time it becomes more important than ever for us all to take control of our finances to avoid overspending and the potential circle of debt that can follow.”
