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25/02/13 - The Co-operative Bank reveals the festive financial hangover that will last until March

The Co-operative Bank have today released results that a quarter of Brits will not have paid off their Christmas debt until their March pay day, with 22% claiming they don’t foresee paying off their 2012 debt this year at all.

Results show that the average person ‘overspent’ by £348.53 in December 2012, with only one in 10 having already paid off their financial Christmas hangover by their January pay day.

Seven in 10 people found January a real struggle to get through financially, with two thirds of those polled using their January wage packet to pay off credit cards, overdrafts and other festive bills. As a result, the average person ran out of money on 7th January and two thirds of people have less disposable income than usual to live on in February with the average person having just £191.76 to last them the whole month.

Aside from December and January, which are both notoriously cash-strapped months The Co-operative Bank has tracked which months people feel under the most financial strain. Briton’s struggle the most in February and June each year which appear to stem from on-going debt and the cost of summer holidays. The third most financially difficult month is August, with 13% claiming that childcare costs are a worry during school holidays. The research shows that the average family overspends by staggering £314.50 more than usual during each summer month.

The Easter holidays were also cited as an expensive time for families with the average family expecting to spend £167.75 more than usual this March, with three in ten Brits citing that the money is spent entertaining their children.

However, it’s not just about spending, the research showed that 44% of people do save and budget for these extra expensive months, with this group saving on average £89.68 per month. May is cited as the month where most people feel that they can save, after 45% of us Brits making it a New Year’s resolution, and six in ten people wanting to save in 2013.

Zack Hocking, Head of Savings at The Co-operative Bank said: “2012 was certainly a tough year for most financially and 2013 will see similar challenges. However, it’s encouraging that an increasing number of people appear to be making saving a priority during 2013.

It’s important to note that people don’t only need savings for luxuries such as big holidays, but also for those months that will be a struggle with extra childcare, seasonal events and other costs that are just a part of life. As a responsible lender, we advise people who are worried about their finances to talk to an advisor about the best options available to them.”

During the average month, people manage financially in the following ways:

1. Dipping in to their overdraft (42%)
2. Putting expensive items on their credit card (34%)
3. Withdrawing some savings (29%)
4. Burying their head in the sand (19%)
5. Taking on extra work (16%)

Top 10 cut-backs:

Ends

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Notes to Editors

The above announcement includes the following packaged accounts; smilemore, Privilege and Privilege Premier.

About The Co-operative Banking Group

The Co-operative Banking Group is the banking and insurance arm of The Co-operative Group, which is the UK’s largest mutual business, owned not by private shareholders but by over six million consumers.

The Co-operative Group has 4,800 retail trading outlets, employs more than 100,000 people, and has an annual turnover of more than £13bn.

It is the UK’s fifth biggest food retailer, the leading convenience store operator and a major financial services provider, operating The Co-operative Bank, Britannia and The Co-operative Insurance. Among its other businesses are the number one funeral services provider and one of Britain’s largest farming operations.

The Co-operative Banking Group is one of the largest and most highly diversified mutual businesses operating in both retail and corporate markets. As part of The Co-operative Group, the business is characterised by its unique ethical and member reward policies and very high levels of customer advocacy.

The Co-operative Banking Group has £70 billion in assets, 12,000 staff and nine million customers. It has over 300 high street branches, 20 corporate banking centres and major presences in Manchester, Leek, London, Plymouth, Skelmersdale and Stockport.

It is the only mutual organisation that enables its members to earn financial rewards for the products they hold, as well as giving them the opportunity to have a say in how the business is run.