Yahoo Finance Coronavirus: Quarter of Brits to cut back at Christmas with London most-affected
The financial fallout of COVID-19 will lead to huge cutbacks this Christmas, with London, Bristol and Sheffield among the worst-affected areas.
Three in 10 households across the UK will feel financial pressure this Christmas, with nearly a quarter (24%) planning to cut back their spending significantly, according to a survey of 1,000 Brits by Lowell.
London is most affected, with 24% of households set to reduce their spending significantly.
However, Bristol (20%) and Sheffield (20%) follow closely behind, the report shows.
At the other end of the scale, Glasgow is least affected, with just 3.4% of residents planning to cut back, followed by 5% of those in Southampton and 8.3% of those in Cardiff.
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Payday loans, borrowing from family and friends, loans and pre-purchase Christmas schemes are also expected to rise dramatically, as households struggle to cover the costs of the holidays.
Payday loans will increase by 110% from Christmas 2019, the study found.
Meanwhile, borrowing from friends or family will increase 36%, while dependency on Christmas pre-purchase schemes, such as monthly-pay Christmas catalogues, will shoot up 34%, according to the report.
The increase in borrowing is driven largely by pressure to overspend, with three-in-five households feeling they just do so on presents, while 64% feel they must on food.
Spending on credit cards is set to drop 18%, while purchases made with savings will drop 3% and those with disposable income will fall by 6%.
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“During these unprecedented and uncertain times we understand that many people are struggling,” said John Pears at Lowell.
“We want to take this opportunity to stress that people should not feel pressured into spending more than they can afford at this time of year.
“Our report shows that, worryingly, there is an increase of people intending to use payday loans or other methods of credit to fund Christmas — sadly, this can lead to debt that can mount beyond control.”
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