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Half of Brits rely on borrowing to get through January

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Kalila Sangster
·2-min read
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Close up of a man with a wallet putting coins inside
Many Brits will be thinking about their finances on Wednesday as 20 January is the day most people run low on money after over-spending at Christmas. Photo: Getty

Half of Brits are likely to rely on some form of borrowing in January, according to new research from Vanquis.

The figure rises to almost seven in ten (67%) for those with outstanding debts, a survey of 2,000 people found.

Many Brits will be thinking about their finances on Wednesday, as 20 January is the day most people run low on money after over-spending at Christmas. An estimated 1.2 million people will be feeling the pinch on what Vanquis called “the leanest day of the year”. Christmas leaves most with a five-week wait until pay day.

Almost one in three (30%) Brits have already maxed out all of their credit and buy-now pay-later customers will be beginning to see charges for December spending hit their accounts.

READ MORE: How to make an extra £500 by selling old items

Almost a quarter (23%) of people reported feeling under pressure to spend more money than they’d like to over the festive period, with an average overspend of £211 ($289).

“The New Year is a great time to reset and think about how you can improve your financial wellbeing in 2021,” said Thomas Allder, customer director at Vanquis. “There are a number of positive, small steps you can make to your day-to-day finances to help you get off on the right foot this year and help build your credit score.”

Over half (58%) of Brits have made a financial resolution for 2021. Younger generations have the most financial intentions, with 77% of 18- to 35-year-olds pledging to turn over a new financial leaf.

Over a quarter (27%) said they want to save more this year, while 24% resolved to spend less. Some 15% of people plan to pay off debts and 13% intend to make a budget plan. One in three (33%) of those with existing debts said they want to start paying it off.

READ MORE: Brits facing up to £2.3bn 'buy-now pay-later' Christmas bills

“Budgeting earnings and planning outgoing costs in a tracker is a good place to start, then you will see an accurate picture of your finances,” Allder said. “This means you can then manage paying bills on time, set realistic savings goals and consolidate debts to pay the lowest possible interest rate and set a timeline to pay it off.”

15% of Brits plan to spend less on their food shopping in order to save money, 14% want to make use of budgeting and planning for the month, and 11% plan to be more mindful of their utility usage to reduce their bills.

WATCH: Should I pay off debt or save money during the coronavirus pandemic?