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Half save to avoid Christmas credit hangover

One in two put money aside for festive bills

Credit cards in a wallet

1 in 4 people have a credit card they haven’t used in the last year

Half of UK consumers save for Christmas to avoid racking up credit card debt, new research shows.

A survey by business advisory firm Deloitte found that 50% of Britons kept money aside for Christmas gifts and food shopping, and only 16% planned to pay for the bulk of their festive purchases by credit card.

Northern Irish consumers were found to be ahead of the pack, with seven in 10 saving for Christmas, ahead of people from Scotland, the North West and the East Midlands, 62% of whom saved.

Young women and older men proved to be the most likely to save, with two-thirds of 16 to 24-year-old women planning to set aside funds, and 59% of men aged over 55 doing the same.

But only a third of 16 to 24-year-old men, and 41% of 55-plus women were considering saving money.

Festive funds

‘Our findings show that one in two people in the UK actually save for Christmas,’ said Nick Sandall, head of retail banking at Deloitte. ‘This is good news, given that UK consumers already owe billions of pounds in credit card debt.

‘It would clearly be a concern if people were putting most of their Christmas expenditure on credit as well.’

Wales was found to have the highest percentage of credit card users, with 28% of respondents saying they would pay for most of their Christmas expenses using credit, closely followed by consumers in South East England and Greater London.

Only 5% of people questioned from the North East said they would pay for the majority of their purchases with a credit card.

Mr Sandall added: ‘Consumers will need to keep an eye on their Christmas spending this year.

Costly borrowing

‘Credit won’t be as easy to come by in 2008 and, if they do slip into the red, they may well find that borrowing is more costly as credit card, overdraft and loan rates creep up.’

* TNS questioned over 1,000 adults in August and September.

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