Too Much Christmas Cheer Leads to UK Bankruptcy and Debt
A new report that surfaced this week in the UK has shown that close to 4 million people in the United Kingdom have entered debt in order to pay for the holidays in 2009. GfK NOP undertook some research and studies and concluded that 3,989,272 consumers in the UK are now dealing with high levels of debt and even bankruptcy based on their overspending during the festive season.
On top of that startling statistic, the study also showed that just fewer than 6.5 million UK citizens are worried that they will not have enough money or financial resources to make it to the end of January. And it all appears to be thanks to the Christmas spending and the increase in household bills over the last year.
The study was officially conducted in December and also found that 8% of adults have borrowed money from friends, family, or institutions in order to get out of debt after their Christmas spending. If that wasn’t alarming enough, close to 3 million people stated that they are still working their way out of bankruptcy or debt thanks to the Christmas of 2009.
Aside from finances, there has been note that a lot of peer pressure, guilt, and expectations play a part in the overspending that comes during Christmas. Research showed that over 30% of respondents felt that they had to spend extra money on Christmas in order to prove they could match their friends and families.
Derek Oakley who is the director of insolvency for Debt Free Direct stated that he and the company know all about the pressure of Christmas, especially for people that are already dealing with bankruptcy or debt management plans. January usually holds the most amount if individual voluntary agreements and insolvencies due to the season. That is why Oakley urged UK consumers to seek out debt advice even though they may not feel comfortable doing so. When seeking advice however, it is crucial that consumers find tailor made and unique advice for their situation, and do not just follow what other people are doing.
2009 saw a high of personal bankruptcy issues and it looks like 2010 is going to be just as bad. The hope is that maybe this Christmas people can turn things around and not give into all of the pressure. If UK consumers can see the result of their spending and put it all into perspective then they have a much better chance to break out of debt and avoid bankruptcy.
Debt Free Direct urges people in the UK to create realistic budgets and stick to them, as well as seek out professional help before it is too late. Debt is something that can be dealt with and fixed as long as things are not allowed to get to out of hand first. While professional advice is often very intimidating, it is almost completely necessary thanks to the credit crunch, bank failures, and long winded recession that has gripped the UK for the past few years.
