According to a new report from Abbey Banking, 64 per cent of Brits regularly have to make sacrifices in the days preceding their pay packet because they've run out of money. On average, these poor planners have five days of going without before they get their next pay cheque. This month "payday mayday" is most likely happen on the 25th November, as most people get paid on the last day of the month.
This phenomenon is likely to be exacerbated by a decrease of 29 per cent in average disposable income compared with two years ago. The Abbey study found that the average Brit now spends around 75 per cent of their income on "essentials". Unsurprisingly, the main cost of living for most of us is our monthly mortgage or rent - almost a quarter (23.7 per cent) of our income is spent meeting this cost. Following this closely were household bills and food costs (both 16 per cent).
With Christmas fast approaching, up to 29 million people will have to make sacrifices over the coming months in order to get through this expensive time of year. First to go is likely to be our social lives, as 43 per cent of us give up going out first when we're running low on funds. 17 per cent of us are likely to stop buying new clothes, followed by cosmetics (six per cent) and three per cent of people are prepared to go hungry at the end of the month, rather than sacrifice anything else.
Steve Shore, Director of Banking at Abbey, comments: "A staggeringly high number of people regularly fail to budget effectively each month and end up running out of cash before their next pay cheque. With disposable income down and Christmas almost upon us, planning your finances carefully has never been more important."
Regionally, those in the North of England are the worst at budgeting, with 67 per cent regularly running out of money in their current account before the end of the month. The Scots are the best budgeters, with just 48 per cent having to forgo purchases towards the end of the month.
Unsurprisingly, youngsters are the poorest planners, with 81 per cent of 18-24 year olds regularly running out of money in their current accounts before the end of the month, and 74 per cent of 25-34 year olds. 55-64 year olds are the better budgeters, with just over half (51 per cent) running out of money before the end of the month.
