IT MAY take some people more than seven months to pay off debt accumulated in the run-up to Christmas, according to a survey by the Irish League of Credit Unions.
Despite the grim economic climate, the survey found adults expected to spend an average of €562 each this Christmas. This level of spending would leave 38 per cent of people in debt in the new year.
With less than five weeks to Christmas, the league has urged the public to avoid borrowing beyond their means.
“We have seen the impact of some of the toughest financial challenges play out in 2011,” its chief executive Kieron Brennan said. “Worries over how to finance Christmas is not far from people’s minds.”
He also warned people not to be tempted into using moneylenders, due to the high rate of interest charged, and also to watch out for credit card debt, as a high rate of interest would be charged to balances that were not cleared on time every month.
The league’s annual pre-Christmas survey showed 55 per cent of respondents intended to use general savings or cash to pay for Christmas, with 28 per cent using specific savings set aside.
Some 9 per cent anticipated using their credit card with smaller numbers availing of credit union loans and money lenders.
The survey showed that 26 per cent of respondents intended spending less than €300, 27 per cent between €300 and €500, 18 per cent between €500 and €700 and 18 per cent between €700 and €1,000.
Unsurprisingly, given the economic climate, 77 per cent of respondents did not feel any better about their financial situation than they did last Christmas.
In terms of recovering from overspending during the festive season, 34 per cent of respondents stated that it would take up to three months to repay the debt, 12 per cent suggested it would take four months or more and a small proportion of respondents said it would take more than seven months to recover financially from Christmas 2011.
