Financial Troubles Loom as One Third of UK Adults to Run Out of Money by End of January

A recent survey has highlighted a concerning trend among UK adults, with a substantial number projected to deplete their finances by the end of January, painting a troubling picture of financial strain in the new year. According to findings released by Credit Karma, 56% of adults are anticipated to exhaust their entire monthly income by 20 January, largely due to the burden of increased winter bills and the lingering impact of Christmas expenses.

In response to this looming financial shortfall, a significant portion of the surveyed population expressed intentions of turning to credit to address their monetary deficiencies. The peak for such financial relief applications is expected on 19 January, with credit cards, buy-now-pay-later schemes, car finance, and personal loans being recognized as the most prevalent alternatives among respondents.

Akansha Nath, General Manager at Credit Karma, offered insights into the prevailing financial predicament, noting the tumultuous nature of the post-Christmas period for individuals. She advised individuals to consider utilizing budget planning tools to navigate their financial commitments effectively and recommended prudent approaches to managing post-Christmas credit liabilities, such as exploring debt consolidation and pursuing advantageous balance transfer offers.

The survey also outlined the measures respondents intend to take to alleviate financial strain at the start of the year. A significant 26% of participants expressed plans to reduce social engagements, while nearly half revealed their reluctance to invest in new technology. Additionally, a considerable proportion of respondents disclosed their intent to use credit for essential expenses and bills, reflecting a widespread reliance on credit to manage their Christmas outlays.

The findings stem from a comprehensive survey conducted by Credit Karma, capturing the perspectives of 2,000 UK adults between 6 and 9 January. The survey offers a poignant glimpse into the financial landscape in the UK, highlighting the need for astute fiscal management and prudent financial planning in the face of the formidable financial challenges posed by the new year.